Question: Problem 4 ( 30 points) Dominic's supermarket chain sells' Nut Flakes, a popular cereal manufactured by the Tastee cereal company. Demand for Nut Flakes is

Problem 4 ( 30 points) Dominic's supermarket

Problem 4 ( 30 points) Dominic's supermarket chain sells' Nut Flakes, a popular cereal manufactured by the Tastee cereal company. Demand for Nut Flakes is 720 boxes per week. Dominic's has a holding cost of 30 percent and incurs a fixed trucking cost of $800 for each replenishment order it places with Tastee. Assume the company operates 50 weeks a year. (a) Given that Tastee normally charges $3.00 per box of Nut Flakes, how much should Dominic's supermarket chain order in each lot? (15 points) (b) Tastee runs a trade promotion, lowering the price of Nut Flakes to $2.50 for a month. How much should Dominic's supermarket chain order, given this short-term price reduction? What is the forward buy? (15 points)

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