Question

The Shoprite grocery store places orders each week for an entertainment magazine that it stocks on the shelves next to the cashiers. The newsstand price for the magazine is $ 5 and the cost per magazine from the publisher is $ 3. Shoprite can return any unsold magazines at the end of the week for a 50¢ credit. Answer the following questions using weekly order sizes and demand levels of 200, 400, and 600 magazines.
Using the decision table from Problem, choose the best order size of magazines using the following criterion:
From Problem 
Demand Level 
ALTERNATIVE 
200 
400 
600 
200 
$400 
$400 
$400 
400 
–$100 
$800 
$800 
600 
–$600 
$300 
$1,200 
a. Maximax
b. Maximin
c. Equally likely
d. Minimax regret e. Hurwicz using α = 0.3


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  • CreatedJuly 29, 2015
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