Question

TS nortunately, any cases not sold by the end of the month are of no value, due to spoilage. How many cases of cheese should Jason manufacture each month? 3-27 Farm Grown, Inc., produces cases of perishable food products. Each case contains an assortment of veg- etables and other farm products. Each case costs $5 and sells for $15. If there are any cases not sold by the end of the day, they are sold to a large food pro- cessing company for $3 a case. The probability that daily demand will be 100 cases is 0.3, the probabil- ity that daily demand will be 200 cases is 0.4, and the probability that daily demand will be 300 cases is 0.3. Farm Grown has a policy of always satisfying customer demands. If its own supply of cases is less than the demand, it buys the necessary vegetables from a competitor. The estimated cost of doing this is $16 per case. (a) Draw a decision table for this problem. (b) What do you recommend? 3-28 In Problem 3-27, Farm Grown, Inc. has reason to believe the probabilities may not be reliable due to changing conditions. If these probabilities are ignored, what decision would be made using the