1. Use the sales forecaster's rediciton to describe a normal probability distribution that can be used to approximate the demand distribution. Sketch the distribution and show its mean and standard deviation.

2. Compute the probability of a stock-out for the order quantities suggested by members of the management team.

3. Compute the projected profit for the rder quantities suggested by the management team under three scenarios: worst case in which sales = 10,000 units, most likely case in which sales = 20,000 units, and best case in which sales = 30,000 units.

4. One of Specialty's managers felt that the profit potential was so great that the order quantity should have a 70% chance of meeting demand and only a 30% chance of any stock-outs. What quantity would be ordered under this policy, and what is that projected profit under the three sales scenarios.

5. Provide your own recommendation for an order quantity and note the associated profit projections. Provide a rationale for your recommendation.

#### Top Answer

Dear student, PFA revised solution.... View the full answer

### Recently Asked Questions

- Hi, I need help for chemistry lab question: What is the solid that forms when a solution starts to freeze?

- 1. For the following table fill in the concentrations in the PCR (6 marks). Briefly, describe the banding patterns you might expect to observe on a gel based

- Imagine you are in a game show, where you simply PICK A BOX (but you can't actually see the "winners"): There are 4 prizes hidden on a game board with 16