Wooden Bakery management team have decided to look thoroughly into their waste management system since they noticed that bakeries can be terribly wasteful. Often any bag of 5 loaves of Lebanese bread left at the end of the day is thrown out. With the currency devaluation we are currently facing, it costs them $1 to prepare one bag and before the end of the day they can sell each bag for $6. (a) (3 points) Which type of model should be adopted in your opinion? (b) (5 points) If they expect a daily demand of 50 bags with a standard deviation of 10 following a normal distribution, what is the optimal number of loaves that the bakery should make each day? (Round your answer to the nearest whole number.) (c) (5 points) If they expect a daily demand of 30 to 60 bags following a uniform distribution, what is the optimal number of loaves that the bakery should make each day? (Round your answer to the nearest whole number.) (d) (3 points) If Wooden Bakery would like to sell left over bags of loaves of bread at a discounted price, what discount price should they select to yield an optimal stock level with a 95% service level?

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A predictive model should be adopted in order to predict the demand for Lebanese bread and minimize ... View the full answer