Business, 02.08.2021 20:10 meyeroppelt
Cuban plans to sell one-time-only special edition Luka Doncic jerseys at a price of $100 each in his vacation resort. The production cost for each of these jerseys would be $55 thanks to their golden details, and any unsold jersey at the resort will simply be donated to an orphanage. Cuban estimates the demand for the jerseys during in the resort by the following distribution, with P(·) being the probability distribution.
Number of Jerseys P(Number of Jerseys)
30 0.10 60 0.25 90 0.40 120 0.20 150 0.05
Calculate the expected profit (that is, maximum expected revenue minus the expected demand- supply mismatch cost) Cuban would make if he produces newsvendor-optimal number of jerseys.
Answers: 1
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Cuban plans to sell one-time-only special edition Luka Doncic jerseys at a price of $100 each in his...
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