1. Consider the following demand scenario:QuantityProbability2,0003%2,1008%2,2002,30015%30%2,40017%2,50012%2,60010%2,7005%Suppose the manufacturer produces at a cost of $20/unit and sells to the distributor at $40/unit. Thedistributor sells to end customers for $50/unit during season; unsold units are sold for $10/unit afterseason.1. Assume the manufacturer will buy any unsold items at price $32/unit. What is the optimal orderquantity?2. What is the expected number of unsold items?3. What is the profit for the distributor?4. What is the profit for the supplier?

Given data, Quantity Probability 2000 3% 2100…

Answered: 1. Consider the following demand…

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter2: The Purchasing Process

Section: Chapter Questions

Problem 1GPE

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