The owner of a small local bakery wants to determine how many fruit-filled pastries she should bake each day. Each pastry costs $.60 to make and sells for $1.00 each. Each pastry that is not sold at the end of the day is sold the next day for $.30 as day-old merchandise. She has determined that her average daily sales of this type of pastry are 193, with a daily standard deviation of 41. Flag this Question Question 114 pts What is the value of Co

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The owner of a small local bakery wants to determine how many fruit-filled pastries she should bake each day. Each pastry costs $.60 to make and sells for $1.00 each. Each pastry that is not sold at the end of the day is sold the next day for $.30 as day-old merchandise. She has determined that her average daily sales of this type of pastry are 193, with a daily standard deviation of 41. Flag this Question Question 114 pts

-What is the value of Co

-What is the value of Cu

- the value of the cost overage Co is  $ 0.3

- the value of the cost shortage Cu is  $ 0.40

Step-by-step explanation:

Given that;

Revenue per unit R                         =       $ 1.00

Cost per Unit C                               =       $ 0.60

Salvage value per unit  S                =       $ 0.30

Mean Demand μ                              =          193

Standard Deviation of demand  σ  =          41

-To get the value of our cost overage Co;

we simply say

Co = Cost per Unit C - Salvage value per unit  S  

Co = 0.6 - 0.30 = 0.30

therefore the value of the cost overage Co is  $ 0.30

- To find the value of Cost Shortage Cu;

Cu = Revenue per unit R - Cost per Unit C

Cu = 1.00 - 0.60 = 0.40

therefore the value of the cost shortage Cu is  $ 0.40

rick would give her the best deal as he will charge $8.88 per hour