Question: Flextrola, Incorporated, an electronics systems integrator, is planning to design a key component for its next - generation product with Solectrics. Flextrola will integrate the
Flextrola, Incorporated, an electronics systems integrator, is planning to design a key component for its nextgeneration product with Solectrics. Flextrola will integrate the component with some software and then sell it to consumers. Given the short life cycles of such products and the long lead times quoted by Solectrics, Flextrola only has one opportunity to place an order with Solectrics prior to the beginning of its selling season. Flextrola's demand during the season is normally distributed with a mean of and a standard deviation of Use Table
Solectrics' production cost for the component is $ per unit, and it plans to sell the component for $ per unit to Flextrola. Flextrola incurs essentially no cost associated with the software integration and handling of each unit. Flextrola sells these units to consumers for $ each. Flextrola can sell unsold inventory at the end of the season in a secondary electronics market for $ each. The existing contract specifies that once Flextrola places the order, no changes are allowed to it Also, Solectrics does not accept any returns of unsold inventory, so Flextrola must dispose of excess inventory in the secondary market.
Note: If a part of the question specifies whether to use Table or to use Excel, then credit for a correct answer will depend on using the specified method.
a What is the probability that Flextrola's demand will be within of its forecast? Use Excel.
Note: Round your answer to decimal places.
Probability
b Under this contract, how many units should Flextrola order to maximize its expected profit? Use Table
Order quantity
c If Flextrola orders units, how many units of inventory can Flextrola's expect to sell in the secondary electronics market? Use Table
Note: Round your answer to mathbf decimal places.
Expected leftover inventory
d If Flextrola orders units, what are expected sales?
Note: Round your answer to mathbf decimal places.
Expected sales
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