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 $473 each and have no salvage value. The manager has compiled the frequency distribution for the probable usage of spare parts:6 spare parts with frequency 0.14;7 spare parts with frequency 0.09;8 spare parts with frequency 0.15;9 spare parts with frequency 0.23; and 10 spare parts with frequency 0.39. For what range of shortage costs would stocking 8 spare parts constitute an optimal decision ?

Between 141.3and 289.9

Between 169.5and 347.9

Between 211.9and 434.9

Between 70.64and 145

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