Eddie bauer buy to maximize expected profit

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Reference no: EM132254781

Eddie Bauer forecasts demand for its new parka to be normally distributed with mean of 2,100 and standard deviation of 650. Eddie Bauer sells these parkas for $140 each. Unsold parkas are donated to charity and the associated tax write-off is worth $20 per parka. If Eddie Bauer purchases these parkas from their Asian supplier at a cost of $45 per parka, how many parkas should Eddie Bauer buy to maximize expected profit?

Reference no: EM132254781

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