PROBLEM 4: Consider a retail store which sells a perishable good with a life of only one period. At the beginning of each period, the store in anticipation of demand, order Q pounds from a supplier at a cost of $75/lb. The demand is uncertain, but based on historical data; it is normally distributed with mean of 350 and standard deviation of 50. The retail price of this item is $95/lb. In case the demand is less than Q, any unused amount has no salvage value. (a) Use marginal analysis to determine the optimum Q that a supplier should order every period.

PROBLEM 4: Consider a retail store which sells a perishable good with a life of only one period. At the beginning of each period, the store in anticipation of demand, order Q pounds from a supplier at a cost of $75/lb. The demand is uncertain, but based on historical data; it is normally distributed with mean of 350 and standard deviation of 50. The retail price of this item is $95/lb. In case the demand is less than Q, any unused amount has no salvage value. (a) Use marginal analysis to determine the optimum Q that a supplier should order every period.

Calculus For The Life Sciences

2nd Edition

ISBN:9780321964038

Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.

Publisher:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.

Chapter2: Exponential, Logarithmic, And Trigonometric Functions

Section2.CR: Chapter 2 Review

Problem 111CR: Respiratory Rate Researchers have found that the 95 th percentile the value at which 95% of the data...

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