Question: . Your manager insists on providing a 9 9 % guarantee to customers of being in stock of fresh flowers. Although you maintain a wide

. Your manager insists on providing a 99% guarantee to customers of being in stock of fresh flowers. Although you maintain a wide selection of related items, some customers are bothered if they visit and you are out of stock of fresh flowers.. A survey tells you that they are bothered by the equivalent of $2. It costs you $3 to purchase flowers, and they sells for $10. Once the flowers pass their prime, you can only turn them into dried bouquets, which sell for only $2. From your sales data, you find that the demand follows the following probability distribution: Q 100150200250300350 P(D=Q)0.050.20.30.30.10.05 What is the optimal quantity of fresh flowers to order? O 200 O 250 O 300 O 350 ANS: 300

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!