Question: A manager intends to order a new machine and must now decide on the number of spare parts to order along with the machine. The

A manager intends to order a new machine and must now decide on the number of spare parts to order along with the machine. The parts cost $441 each and have no salvage value. The manager has compiled the frequency distribution for the probable usage of spare parts:7 spare parts with frequency 0.15;8 spare parts with frequency 0.1;9 spare parts with frequency 0.09;10 spare parts with frequency 0.16; and 11 spare parts with frequency 0.5. For what range of shortage costs would stocking 9 spare parts constitute an optimal decision ?

Between 220.5and 340.8

Between 147and 227.2

Between 73.5and 113.6

Between 176.4and 272.6

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