Business, 30.11.2021 22:20 gabrielmartinsotr4yl
Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $12 each from its Asian suppliers, TeddySports. Unfortunately, at the time of order placement, demand is still uncertain. Teddy Bower forecasts that its demand is normally distributed with mean of 2,100 and standard deviation of 1,200. Teddy Bower sells them at $20 each. Unsold parkas have negligible salvage value; Teddy Bower simply gives them away to charity.
a. What is the probability this parka turns out to be a "dog defined as a product that sells ess than half of the forecast?
b. How many parkas should Teddy Bower buy from TeddySports to maximize expected profit?
c. If Teddy Bower wishes to ensure a 98.5 percent in-stock probability, how many parkas should t order? For parts d and e, assume Teddy Bower orders 3,000 parkas.
d. Evaluate Teddy Bower's expected profit.
e. Evaluate Teddy Bower's stockout probability
Answers: 2
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