The company organizing the famous rapper Sean Pauls concert in Dubai has decided to print shirts to
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The company organizing the famous rapper Sean Paul’s concert in Dubai has decided to print shirts to be sold at the event. The company has estimated that 20,000 attendees will attend the concert and, on an average, 40% of the attendees usually buy shirts, with a standard deviation of 0.05. The cost of the shirt is AED 60 and the selling price is AED 160 Remaining shirts will be discounted at AED 40.
a) What is the cost of underestimating the demand for each shirt?
b) What is the average cost per shirt?
c) How many shirts should the company print for the concert?
d) What is the stockout risk for this order size? lop1
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