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This question was created from QM -Assignment 3 2019.docx https://www.coursehero.com/file/47113085/QM-Assignment-3-2019docx/

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What is the expected profit? what is the variance of the profit? Wally runs a fruit & vege stall - Wally's VegeRama - at the local Sunday market. He can buy watermelons from his supplier for $5 each. He can sell watermelons for $10 each. On any particular Sunday, demand for watermelons follows a Poisson distribution with mean 5. Any watermelons that are not sold on Sunday go bad before the next weekend. Wally's current policy is to stock 6 watermelons)

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c) What is Wally's expected profit? What is the variance of the profit?
(4 marks}

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