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The swedish company rossons sport sells skis and ski-equipment. they purchase skis at a price $ 260 per pair and sell them at a price of $ 240 per pair. Skis not sold this season can be sold early next season at discounted price of $ 200 per pair. In addition, they estimate the stock holding cost between season to be $ 25 per pair of skis.
Puts sales figures show that demand per season is normally distributed with a mean of 459 pairs and a standard deviation of 56.
a) calculate the shortage and overage cost per pair
b) Advise rossons sport about how many pairs of skis they should purchase
c) What is the service level?
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An analysis of the holding costs, including the appropriate annual holding cost rate.
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