A souvenir store sells New Year's Eve sweatshirts with the year and a slogan printed on...

 

Transcribed Image Text:

A souvenir store sells New Year's Eve sweatshirts with the year and a slogan printed on them. Demand for the sweatshirts is forecasted to be normally distributed with a mean of 250 and a standard deviation of 40. The store sells the sweatshirts for $25 each. The sweatshirts cost $12 each to purchase from their supplier. The week after New Year's, unsold shirts are donated free to a local Goodwill store (Please provide Excel functions if applicable). a. What is the probability that the demand will be within +25% of the mean forecast demand? b. What is the probability that the store has a "great" sale of more than 300 sweatshirts? How many sweatshirts should be ordered to achieve a 90% in- stock probability (i.e., satisfying demand 90% of the time)? c. d. What is the overage cost? e. What is the underage cost? f. What is the quantity to achieve the best expected profit? A souvenir store sells New Year's Eve sweatshirts with the year and a slogan printed on them. Demand for the sweatshirts is forecasted to be normally distributed with a mean of 250 and a standard deviation of 40. The store sells the sweatshirts for $25 each. The sweatshirts cost $12 each to purchase from their supplier. The week after New Year's, unsold shirts are donated free to a local Goodwill store (Please provide Excel functions if applicable). a. What is the probability that the demand will be within +25% of the mean forecast demand? b. What is the probability that the store has a "great" sale of more than 300 sweatshirts? How many sweatshirts should be ordered to achieve a 90% in- stock probability (i.e., satisfying demand 90% of the time)? c. d. What is the overage cost? e. What is the underage cost? f. What is the quantity to achieve the best expected profit?

Answer rating: 100% (QA)

a calculate zscores for both upper and lower limits Zlower2502540 625 Zupper2502540 6875 CDFZlower1 ... View the full answer