Question: (This problem description is for Questions 16-20) a particular model of air conditioner sold at Sam's Club is purchased from Kool King. Most sales are

(This problem description is for Questions 16-20)

(This problem description is for Questions 16-20) a particular model of air conditioner sold at Sam's Club is purchased from Kool King. Most sales are made in June and July. Sam's makes a one-time purchase of air conditioners in May at a cost of $200 each and sells each air conditioner for $400. Any air conditioners unsold at the end of July are marked down to $175 and sold in a special sale. All marked-down air conditioners are sold. The total (June + July) customer demand distribution for air conditioners is given below (predicted based on data analysis): 6,000 7,000 8,000 9,000 10,000 11,000 12,000 13,000 14,000 Demand X Probabi lity 0.04 0.08 0.12 0.16 0.2 0.16 0.10 0.10 0.04 What is the optimal (target) service level (Critical ratio)? 78.05% 83.89% 86.79% 88.89% o O 90.27% 85.89%

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