Matthew’s Bakery prepares peanut butter cookies for sale every morning. It costs the bakery $0.50 to bake each peanut butter cookie, and each cookie is sold for $1.25. At the end of the day, leftover cookies are discounted and sold the following day at $0.40 per cookie. The daily demand (in dozens) for peanut butter cookies at this bakery is known to be normally distributed with mean 200 and standard deviation 60. The manager of Matthew’s Bakery is trying to determine how many dozen peanut butter cookies to make each morning to maximize the product’s contribution to bakery profits. Use simulation to find a very good, if not optimal, production plan.
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