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Case: Alexander Norman owns several retail fur stores in a large North American city. In the spring of each year, he must decide on the number of each type of fur coat to order from his manufacturing supplier for the upcoming winter season. For a particular muskrat line, his cost per coat is $150 and the retail selling price is $210. He estimates an average sales of 100 coats but with considerable uncertainty, which he is willing to express as a uniform distribution between 75 and 125. Any coat not sold at the end of the winter can be disposed of at cost ($150) to a discount house. However, Norman feels that on any such coat he has lost money because of the capital tied up in the inventory for the whole season. He estimates a loss of $0.15 for every dollar tied up in a coat that must be sold off at the end of
the season.
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Health system in Pennsylvania
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Nittany Fans of Lewistown, Pennsylvania, is a distributor of industrial fans used in plants, warehouses, and other industrial facilities.
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