Explain how many cakes should be prepared to maximize expect

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Q. A Las Vegas supermarket bakery must decide explains how many wedding cakes to prepare for upcoming weekend. Cakes cost $33 each to make and y sell for $60 each. Unsold cakes are reduced to half-price on Monday and typically 1-third of those are sold. Any that remain are donated to a nearby senior center. Analysis of recent demand resulted in subsequent table:
Demand 0 1 2 3
Probability .15 .35 .30 .20
Explain how many cakes should be prepared to maximize expected profit?

Reference no: EM1374943

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