Question: (a) A store is considering how many current model televisions to order given a new model is soon to be released next month. The probability

(a) A store is considering how many current model televisions to order given a new model is soon to be released next month. The probability distribution of demand for the current model of television is normal with a mean of 350 units and a standard deviation of 100 . The current television retails for $2100 each and costs $910 each to purchase. The total cost of a shortage is estimated to be $100 per television. Any unsold televisions at the end of the month will be sold in store at the discounted price of $700 per television. (i) How many current televisions should be ordered to minimise the expected total cost given that only one order may be placed? (5 marks) (ii) The supplier is offering an order of 250 units of the soon-to-be-obsolete model at a reduced purchase price of $650. Any unsold televisions cannot be sold in store but must instead be disposed of at a cost $50 per television. If the shortage cost remains the same, what retail price per television will make the 250 units optimal
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