A retailerplanning to selljacketsduring winterfaces the following probabilitydistribution of demand for jackets:

x	Probability(D=x)	Probability(D<=x)
51	8%	8%
52	9%	18%
53	10%	28%
54	11%	38%
55	12%	50%
56	12%	62%
57	11%	72%
58	10%	82%
59	9%	92%
60	8%	100%

The retailer buys each jacket for $400 and sells it for $600. The retailer sells any leftover jacket in the spring sale at $300.

Suppose the supplier offers to buy any leftover jackets for $375, so the retailer decides to sell any leftover jackets to the supplier (instead of the spring sale).What is optimal service level retailer would target and what is the optimal order quantity of jackets?

A. 66.7% and 57

B. 88.9% and 59

C. 80% and 58

D. 95% and 60

Answer rating: 100% (QA)

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