Question: Hello! I am having trouble figuring out how to do 1,4,5. Can you please explain how to solve this for me? Thank you As with

Hello! I am having trouble figuring out how to do 1,4,5. Can you please explain how to solve this for me? Thank you

As with other products, Poke faces the decision of how many Chatty Bear units to order for the coming holiday season.Members of the management team suggested order quantities of 15,000, 18,000, 24000, or 28000 units.The wide range of order quantities suggested indicates considerable disagreement concerning the market potential.The product management team asks you for an analysis of the stock-out probabilities for various order quantities, an estimate of the profit potential, and to help make an order quantity recommendation.Poke expects to sell Chatty Bear for $24 based on a cost of $16 per unit.If inventory remains after the holiday season, Poke will sell all surplus inventory for $5 per unit.After reviewing the sales history of similar products, Poke senior sales forecaster predicted an expected demand of 20,000 units with a 0.9 probability that demand would be between 10,000 and 30,000 units.

  1. Use the sales forecaster's prediction to describe a normal probability distribution that can be used to approximate the demand distribution.Sketch the distribution and show its mean and standard deviation.
  2. Compute the probability of a stock-out for the order quantity suggested by members of the management team.
  3. Compute the projected profit for the order quantities suggested by the management team under three scenarios: Worst case in which sales = 10,000 units, most likely case in which sales = 20,000 units and the best case in which sales = 30,000 units.
  4. One of Poke's managers felt that the profit potential was so great that order quantity should have a 70% chance of meeting demand and only 30% chance of any stock outs. What quantity would be ordered under this policy, and what is the projected profit under the three sales scenarios?
  5. Provide your own recommendation for an order quantity and note the associated profit projections. Provide a rational for your recommendation.

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