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 $431 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 0.06;8 spare parts with frequency 0.05;9 spare parts with frequency 0.19;10 spare parts with frequency 0.12; and 11 spare parts with frequency 0.58. For what range of shortage costs would stocking 9 spare parts constitute an optimal decision ?

Between 63.92and 221.7

Between 53.27and 184.7

Between 79.9and 277.1

Between 26.63and 92.36

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