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Henrique's Correa's bakery prepares all its cakes between 4am and 6am so they will be fresh when customers arrive. Day-old cakes are virtually always sold but at a 50% discount off the regular $10 price. The cost of baking a cake is $6 and demand is estimated to be normally distributed with a mean of 25 and a standard deviation of 4. What is the optimal stocking level?
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A manufacturer uses a purchase part who's demand over any time period of length t (in years) can assume to be normally distributed with mean 200t and variance 400t. The part cost $
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