Note: This assignment may take longer than earlier assignments, you will also have longer to complete it. Plan accordingly.

All work must be included and presented in a manner that is easy to follow to be able to receive full credit (assuming answers are correct!) You may work on your own or in pairs. If working in pairs, submit only once but with both names listed.

1. The manager of the Campus Bookstore is buying basketball jerseys in anticipation of the coming season. They have two supply options:

Supplier 1 charges $ 35 per jersey but only one order can be placed, with delivery in time for the season.

Supplier 2 charges $ 40 but can support a second order after the start of the season.

The store plans to sell jerseys for $60, and anticipates selling any unsold inventory at the end of the season for $30. Based on a single order if supplier 1 is used, the manager anticipates demand to be for 1,500 jerseys with a standard deviation of 300. If they use supplier 2 and order just enough to have product on the shelf at the start of the season, they anticipate demand to be for 500 jerseys with a standard deviation of 75. For each supplier, how much will the manager have to spend on jerseys?

2. Given cash flow considerations and mixed pre-season reviews of the team, the manager decided to go with supplier 2. The team however is on a roll and demand for the rest of the season is expected to be for 1,250 jerseys with a standard deviation of 200. How many more jerseys should the manager order, and what will their expected profit be for the full season? (Hint: Dont forget how the first order worked out).