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A gasoline mini-mart orders copies of a monthly magazine. Depending on the cover story, demand for the magazine varies. The mini-mart purchases the magazines for

A gasoline mini-mart orders copies of a monthly magazine. Depending on the cover story, demand for the magazine varies. The mini-mart purchases the magazines for $ and sells them for $. Any magazines left over at the end of the month are donated to hospitals and other health care facilities. Modify the newsvendor example spreadsheet to model this situation. Use what-if analysis to investigate the financial implications of this policy if the demand is expected to vary between and copies each month

Newsvendor Model

A

B

1

Newsvendor Model

2

3

Data

4

5

Selling price

$3.88

6

Cost

$1.73

7

Discount price

$0

8

9

Model

0

11

Demand

10

12

Purchase Quantity

24

13

14

Quantity Sold

15

Surplus Quantity

16

17

Profit

The formula for the quantity sold is =MIN(B11,B12).

The formula for the surplus quantity is =MAX(0,B12-B11).

The formula for the profit is =B14*B5-B12*B6.

The demand must be at least ? copies for the gasoline mini-mart to break even.

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