Question

The first edition hardcover of a new book by a popular writer has a demand which is normally distributed with an average of 5 million and a standard deviation of 1 million. The production and transportation costs per hardcover are $12, and the sale price in bookstores is $30. When the paperback version comes out, the hardcover books go on sale for $7.50. How many hardcovers should be produced? 6.00 million Exactly 5.80 million Approximately 5.84 million O 5.00 million

Answer 1

Mė Sorrno loros $12 R = $30 $7.50 Cs P-C= 30-12-18 a(as a 12-7.50 = 4.5 Service level Cu Cotlu 18 laty 2 value from a table far o.d = 0.8416 optimum quantity M+ (2x) zvedeling Sant 0.846 loss Sayl600 S. 84 millon