exam1011 - ISyE 3232 Exam # 1 Spring 2011 Name Please be...

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ISyE 3232 Exam # 1 Spring 2011 Name Please be neat and show all your work so that I can give you partial credit. GOOD LUCK. Question 1 Question 2 Question 3 Question 4 Total 1
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(30) 1. YB sporting apparel prints up novelty T-shirts commemorating major sport events. The T-shirts cost $5 to make and distribute and they sell for $20. Company policy is to dispose of any excess inventory after the event by discounting the T-shirts by 80 percent, that is, sell them for $4. It is estimated that the demand for the T-shirts for the next event is uniformly distributed in the interval (0,1000). (10)(a) What is the expected demand for the T-shirts for the next event? (10) (b) If 500 T-shirts are printed, what is the expected profit? (10) (b) What is optimal number of T-shirts that the YB sporting apparel should print in order to maximize its expected profit for the next event? 2
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(30) 2. The production cost per unit of a product is $10, its holding cost per unit is $1 and its retail price is $20. The demand
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exam1011 - ISyE 3232 Exam # 1 Spring 2011 Name Please be...

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