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A manufacturer of industrial sales has production capacity of 1,000 units per day. Currently, the firm sells production capacity for $10 per unit. At this price, all production capacity gets booked about one week in advance. A group of customers have said that they would be willing to pay $15 per unit if capacity was available on the last day. About ten days in advance, demand for the high-price segment is normally distributed with a mean of 250 and a standard deviation of 100. How much production capacity should the manufacturer reserve for the last day?
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However, Billy's must transport the unsold bagels to the kitchen at a cost of 15 cents each. How many bagels should Billy's bake at the start of each day to balance shortage and excess costs?
How has the worldwide demand fro quality driven the concept of innovation? How has innovation changed your life?
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