Determine the probability for new book

Assignment Help Operation Management

Reference no: EM13100145

Dan McClure owns a thriving independent bookstore in Lawrence, Kansas. He must decide how many copies to order of a new book. Dan believes his demand forecast can be represented by a normal distribution with mean 200 and standard deviation 80.
(a) Dan will consider this book to be a "blockbuster" if it sells more than 350 units. What is the probability that this new book will be blockbuster? [5 pts]
(b) Dan will consider this book to be a "dog" if it sells less than 50% of his mean forecast. What is the probability that this new book will be a "dog"?
(c) What is the chance that the demand for the book is within 30% of the average value?
(d) Suppose that Dan's bookstore has 300 copies of this book and no other receipts are
expected. How much is the expected lost sale?
(e) If Dan wants the expected lost sales of this book to be 2 books or lower, how many copies of the book should he order? (Please answer this question independent of part d above.)

Consider the problem of Dan McClure's bookstore described in question 1 above.
(a) What order quantity should he choose to satisfy a 95% expected fill rate?
(b) How many books should Dan order if he wants to achieve a 95% in?stock probability?
(c) Even though the percentages for the expected fill rate and in?stock probability are the same, the order quantities differ. In a few sentences, explain the reason behind this difference (i.e., do your answers make sense?, which one is greater and why?, etc.).

Reference no: EM13100145

Questions Cloud

Define capital project in terms of future and present values : Analyze the concept of "a dollar today is worth more than a dollar in the future," to define a capital project in terms of future and present values.

Probability for independent events : Reggie Miller of the Indiana Pacers is the National Basketball Association's best career free throw shooter, making 89% of his shots. Assume that late in a basketball game, Reggie Miller is fouled and is awarded two shots.

How might arg 210 assist proton flow : An arginine residue (Arg 210) in the matrix-side proton channel of the a subunit of ATP synthase is near the aspartate residue (Asp 61) in the c ring subunit. How might Arg 210 assist proton flow?

Distinguish significance of technical skills andhuman skills : Distinguish the relative significance of four characteristics (technical skills, human skills, conceptual skills, and motivation to manage) which companies look for in managers.

Determine the probability for new book : Dan McClure owns a thriving independent bookstore in Lawrence, Kansas. He must decide how many copies to order of a new book. Dan believes his demand forecast can be represented by a normal distribution with mean 200 and standard deviation 80.

Economical number to produce per production run : Once production is set up, 80 units can be produced per day. Daily demand rate for the units is 60 per day. a. What is the most economical number to produce per production run? b. How long is each production cycle?

Information about joint probability table : Develop a joint probability table for these data and use the table to answer the remaining questions. What do the marginal probabilities tell you about the age of the US population?

What is the frequency of the sickle cell allele : What percentage of these two populations will be carriers of the trait, but not have the disease?

Confidence interval for the mean monthly consumption : Use these statistics to construct a 94% confidence interval for the mean monthly consumption for the population of all Ontario households.

User Account

All Pages