Reference no: EM13877496

1. Average and standard deviations of A/F ratios from exhibit 1. (NB. you only get one A/F and one standard deviation from the whole table)

2. Use exhibit 2 to calculate, the expected demand and the standard deviation of the demand for each wine. (Note: individual wine must have individual demands)

3. In order to get the order quantity, you have to calculate following
ii) Calculate Co (overage cost for each of the wine)
iii) Calculate Cu (underage cost depends upon the discount price, and holding costs (including interest and the cost of storage). And, these rates for red and white wines are different.)
iv) Use these information to calculate order quantity for each wine.

4. Calculate the expected profit for each wine.

Attachment:- Vin.pdf