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Decide on how many copies of a book to purchase

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1. Dan's Independent Book Store is trying to decide on how many copies of a book to purchase at the start of the upcoming selling season. The book retails at $28.00. The publisher sells the book to Dan at $20.00. Dan will dispose of all of the unsold copies of the book at 50% off the retail price, at the end of the season. Dan estimates that demand for this book during the season is Normal with a mean of 1000 and a standard deviation of 250. Suppose Dan orders 1415 copies of the book. What would be his expected mismatch cost?

Reference no: EM13665075

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