What are the unit underage cost and overage cost

Assignment Help Finance Basics

Reference no: EM13299998

The buzz campus eatery offers a specific type of biscuits for $1.5 each from 8am to 3pm. The biscuits are ordered from a supplier at the start of each day and delivered before the store opens. The supplier charges 75 cents per biscuit. If, at 3pm, some biscuits are left, the buzz people mark down the price and sell off all the remaining biscuits for 50 cents each. In contrast, if, before 3pm, a customer comes to buy a biscuit but buzz has run out of biscuits, the buzz gives a free coupon worth 10 cents to the customer as compensation. Demand for biscuits before 3pm at buzz is variable but can only be 40 to 45, with probabilities given in the following table.

Number of customers Probability
40 0.1
41 0.15
42 0.25
43 0.25
44 0.15
45 0.1

(d) What are the unit underage cost (Cu) and overage cost (Co) of the biscuit business?

Reference no: EM13299998

Questions Cloud

What is the net force on the roof : During a violent storm, the wind over a flat, 200 m2 roof has a velocity of 10 m/s. What is the net force on the roof

What is the change in energy that the inductor is storing : if an inductor has a change of current 0.418 A to 0.948 and has an inductance of 1.324, what is the change in energy that the inductor is storing

How much would these bonds sell for today : Assume that WhirledCom has an issue of 15-year $1000 par value bonds that pay 6% interest, semi annually. Further assume that today's required rate of return on these bonds is 9%. How much would these bonds sell for today ?

Depict the sturctures for the alkenes : when 2-butanol undergoes E1 dehydration,three alkenes are obtained. Draw the sturctures for these alkenes.Which alkene would you predict to be formed in greatest abundance.

What are the unit underage cost and overage cost : What are the unit underage cost (Cu) and overage cost (Co) of the biscuit business?

How deep was water on roof at the end of each half period : During a 1.5-hr storm, 1.3 in. of rain fell during the first hour, and 0.4 in. of rain fell during the last half hour. The average flow in the downspouts was 1.7, 3.6, and 3.4 ft3/sec for each of the half-hour periods.

What is the radius of the centrifuge : The centripetal acceleration in a horizontal centrifuge is 75 g's when it is rotating at 2000 rpm, What is the radius of the centrifuge

Economic expansion that increases consumer income : Compare the impact on pre-recorded music compact disks and the cabinet maker''s work of an economic expansion that increases consumer incomes by 20 per cent.

What is the angular acceleration of the ride : A merry go round consists of a flat disk mounted horizontally. What is the angular acceleration of the ride

User Account

All Pages