Bob is a buyer of PCs for a retail chain and plans to place a purchase order for a PC mode. The nature of this market segment is such that demand is uncertain and in a few months, this model will be obsolete. Bob has only one chance to order this model.

Purchase Cost: $1000, Selling Price = $1500, Salvage price = $ 900, Mean Demand = 100 units, SD= 25 units

Find the ordering quantity.

Question 1 (20 points) Bob is a buyer of PCs for a retail chain and plans to place a purchase order for a PC mode. The nature of this market segment is such that demand is uncertain and in a few months, this model will be obsolete. Bob has only one chance to order this model. Purchase Cost: $1000, Selling Price = $1500, Salvage price = $ 900, Mean Demand = 100 units, SD= 25 units Find the ordering quantity