Question

Homework: Homework 4: Inventory Management Save Score: 0 of 1 pt 1 of 7 (2 complete) HW Score: 4.76%, 0.33 of 7 pts X Problem 12.53 Question Help 0 University of Florida football programs are printed 1 week prior to each home game. Attendance averages 90,000 screaming and loyal Gators fans, of whom two-thirds usually buy the program, following a normal distribution, for $4 Bach. Unsold programs are sent to a recycling center that pays only 20 cents per program. The standard deviation is 10,000 programs, and the cost to print each program is $1. Refer to the standard normal table for z-values. a) What is the cost of underestimating demand for each programn? Cs = $3.00 (round your response to two decimal places). b) What is the overage cost per program? Co = $0.80 (round your response to two decimal places). c) How many programs should be ordered per game? 88,050 programs should be ordered per garne (round your response to the nearest whole number). d) What is the stockout risk for this order size? Stockout risk = 0.2105 (round your response to four decimal places). Question is complete. Tap on the red indicators to see incorrect answers. ? All parts showing Similar Question

Answer 1

Cost Price (c) = $1 Given, Selling Price (s) - $4 Salvrige priack) = 40.2 of overage of programm (66)=C-k 3 = 3+0.8 a) Cost underes s-c = 4-1= 3 b) Cost |-0-2= $0.8 c) Now, Service level (P) Cs 0.7895 Cstlo From a table for P=0.7895 → 2-0.80 - 60000 6 = 10000 Now, mean demand (a)= Ophimal order = quantity 60000 + 0.8(10000) = 6 8000 programs (4)= 2 (90000) Mt 266) d) Stock out oisk = 1-p; 10:7895 Co. 0.2105