What is the recommended order quantity

Assignment Help Operation Management

Reference no: EM131031635

A retail store sells a seasonal product for $10 per unit. The cost of the product is $8 per unit. All units not sold during the regular season for half the retail price in an end-of-season clearance sale. Assume that the demand for the product is normally distributed with a mean of 5oo and a variance of 100. a) What is the recommended order quantity? b) To keep customers happy and returning to the store later, the owner feels that stockouts should be avoided if at all possible. What is your recommended order quantity of the owner is willing to tolerate a 5% probability of a stockout or a 95% probability of always having the product?

Reference no: EM131031635

Questions Cloud

Power of the buzz and viral marketing about product-services : Illustrate the power of the “buzz” and “viral marketing” about products and/or services, which should include the positive and negative aspects of buzz marketing, as well as a consideration of the resources allocated to the effort and alternative way..

Medical leave under the family medical leave act : Discuss the policies behind giving medical leave under the Family Medical Leave Act (FMLA)—what is the nation trying to accomplish, and is the FMLA written appropriately to meet those goals? Analyze and evaluate the various issues presented while arg..

Required to form a legally binding contract : Contract law is a very basic and important part of both our everyday life, and the operation of the business world. List and define the three basic elements that are required to form a legally binding contract.

Relationship between the states and the federal government : If the state of California and the federal government both passed laws or regulations related to the sale of video games, which would prevail and why? Discuss the relationship between the states and the federal government, and which has priority. Ana..

What is the recommended order quantity : A retail store sells a seasonal product for $10 per unit. The cost of the product is $8 per unit. All units not sold during the regular season for half the retail price in an end-of-season clearance sale. Assume that the demand for the product is nor..

Competitive advantage for publicly traded firms : Shareholder perspective is perhaps the most widely employed measure of competitive advantage for publicly traded firms. What are some of the disadvantages of using shareholder value as the sole point of view for defining competitive advantage?

Strategies for developing confidence : How would you structure the Introduction(background of study and methods of research ) for the analytical report below? Strategies for Developing Confidence

What can corporations do to foster ethical behavior : What can corporations do to foster ethical behavior within the organization? Are laws passed and enforced by the government enough to compel ethical behavior? What is the relationship between laws and corporate culture?

What is the optimal policy for the fish farms : GloFish, Inc. has genetically engineered a species of fish that glows in normal lighting conditions. The company believes the new fish will be a huge success as a new pet option for children and adults alike. What is the optimal policy for the fish f..

User Account

All Pages