Small firm that manufactures gullo sunglasses

Assignment Help Operation Management
Reference no: EM131125967

( Land’s End ) Geoff Gullo owns a small firm that manufactures “Gullo Sunglasses.” He has the opportunity to sell a particular seasonal model to Land’s End. Geoff offers Land’s End two purchasing options:

• Option 1. Geoff offers to set his price at $65 and agrees to credit Land’s End $53 for each unit Land’s End returns to Geoff at the end of the season (because those units did not sell). Since styles change each year, there is essentially no value in the returned merchandise.

• Option 2. Geoff offers a price of $55 for each unit, but returns are no longer accepted. In this case, Land’s End throws out unsold units at the end of the season. T his season’s demand for this model will be normally distributed with mean of 200 and standard deviation of 125. Land’s End will sell those sunglasses for $100 each. Geoff ’s production cost is $25.  

a. How much would Land’s End buy if they chose option 1?

b. How much would Land’s End buy if they chose option 2?   

c. Which option will Land’s End choose?

d. Suppose Land’s End chooses option 1 and orders 275 units. What is Geoff Gullo’s expected profit?

Reference no: EM131125967

Questions Cloud

Racial discrimination be for intentional or unintentional : Amaani Lyle, an African American woman, was hired by Warner Brothers Television Productions to be a scriptwriters’ assistant for the writers of Friends, a popular, adult-oriented television series. Would Lyle’s claim of racial discrimination be for i..
The process of muscle contraction : In your own words briefly (1-2 paragraphs) the process of muscle contraction. Make sure you utilize the following terms: action potential, neuromuscular junction, acetylcholine, sarcolemma
Starbucks is reaching the limits of its growth without chang : Debate this issue: Starbucks is reaching the limits of its growth without drastic change. (The side that espouses drastic change should give some attention to the most likely directions for such change; be prepared to defend these expansion possibili..
Summarize the strategic issues firms in this industry face : Performed a ratio analysis of the financial performance of two competitors and compared them to H-D. Developed a Word document entitled "The Analysis of H-Ds Current Strategy: Two Views," which includes analysis of your findings.
Small firm that manufactures gullo sunglasses : ( Land’s End ) Geoff Gullo owns a small firm that manufactures “Gullo Sunglasses.” He has the opportunity to sell a particular seasonal model to Land’s End. Geoff offers Land’s End two purchasing options: Geoff offers to set his price at $65 and agre..
What is the annual after-tax cost of debt to the company : 1. The primary operating goal of a publicly-owned firm interested in serving its stockholders should be to _________. maximize its expected total corporate income  maximize its expected EPS  minimize the chances of losses
What is the role of desire in the self : What do you make of the feminist, existential, and non-Western critiques of the essentialist/avocado self? Are there any other problems with the idea that human beings are fundamentally rational creatures?
How you would generate sequence information : Determining if there was a different level of a protein found in zombie brains.- Once identified, describe how you would generate sequence information about the unknown protein.

Reviews

Write a Review

Operation Management Questions & Answers

  Provide a brief summary of the facts

Provide a brief summary of the facts and discuss the standards that were used in determining that a breach had occurred. Also discuss whether you agree or disagree with the findings.

  Evaluate the costs and benefits to both the company

Evaluate the costs and benefits to both the company and the employee. How do the benefits justify the costs. What factors should the company consider when designing a training program. How should its effectiveness be evaluated

  Describe communication as a stakeholder

Use an organization within which you have engaged in significant communication as a stakeholder; possible examples include and educational institution, a place of business where you were a consumer or client; a volunteer organization.

  How can you create a portfolio of assets that minimizes risk

How can you create a portfolio of assets that minimizes risk

  Consider this situation from a virtue ethics perspective

Jim Smith has worked for the ABC Insurance Company for the past twenty-three years. Jim graduated with a top-notch accounting degree and he also has his MBA. Bar none, Jim is considered by everyone in his organization to be a brilliant accountant. At..

  Does adverse impact exist-if adverse impact exists

During 2013, 400 people were hired for a particular job. Of the total, 300 were white and 100 were black. There were 1,200 qualified applicants for these jobs, of whom 800 were white and 400 were black. Does adverse impact exist? If adverse impact ex..

  Describe how bill might use total quality management

Bill has been asked to supervise the production of electric cup holders at his manufacturing company. Bill wants to be certain that his process results in a successful, effective, and efficient product. Describe how Bill might use Total Quality Manag..

  How is conflict conceptualized differently under the unitary

How is conflict conceptualized differently under the unitary and pluralistic view of conflict in society?

  Describe the basic control process

How can a manager determine if more control is necessary, or even possible? Identify and describe the various methods that managers can use to maintain control. Describe the basic control process.

  Why do companies decide to enter a foreign market

Why do companies decide to enter a foreign market?

  What issues do you have with your home inventory maintaining

We all have inventory at home to run our homes. What issues do you have with your home inventory maintaining sufficient quantities and controlling its costs

  Labor market ethical on the basis of virtue ethics

Is employing children in the labor market ethical on the basis of virtue ethics, fundamental rights, or utilitarianism? Why, or why not? What factors would you consider and why?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd