Question
Do not include anything other than numbers in your responses. For example, do not include comma or dollar sign in your numbers. As a rule
Do not include anything other than numbers in your responses. For example, do not include comma or dollar sign in your numbers. As a rule of thumb, keep 2 decimal places for larger numbers and 3 decimal places for smaller numbers less than 1.
Joe's Slop House is a little hole in the wall restaurant that serves slow-cooked barbecue beef sandwiches. The beef for the sandwiches cooks overnight, so each evening Joe decides how much beef to cook for the next day. The beef costs $3 a pound and Joe sells each sandwich (filled with 1 pound of beef) for $5. At the end of the day, any leftover beef is given to the neighborhood church for their soup kitchen. The tax deduction for this is worth $1.5 a pound. Daily demand for the beef can be approximated by a normal distribution with a mean of 230 pounds and a standard deviation of 30 pounds.
A) Cost of Shortage (Cs):
B) Cost of Excess (Ce):
C) What is the optimal service level?
D) What is the corresponding z value?
E) How many pounds of beef should Joe cook for the next day?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started