Pedro runs a fruit shop. Mondays he opens his shop with a fresh supply of strawberries of
Question:
Pedro runs a fruit shop. Mondays he opens his shop with a fresh supply of strawberries of \(s\) pounds, which is supposed to satisfy the demand for three days. He knows that for this time span the demand \(X\) is exponentially distributed with a mean value of 200 pounds. Pedro pays \(\$ 2\) for a pound and sells it for \(\$ 4\). So he will lose \(\$ 2\) for each pound he cannot sell, and he will make a profit of \(\$ 2\) out of each pound he sells. What amount \(s=s^{*}\) of strawberries Pedro should stock for a period of three days to maximize his mean profit?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Applied Probability And Stochastic Processes
ISBN: 9780367658496
2nd Edition
Authors: Frank Beichelt
Question Posted: