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Each year the GreenLawn Hardware Store places one order for a line of luxury lawn mowers in February. The selling season for GreenLawn is
Each year the GreenLawn Hardware Store places one order for a line of luxury lawn mowers in February. The selling season for GreenLawn is March-September. The following probability distribution of demand is assumed by GreenLawn for the lawn mower: Demand 0 1 (a) Suppose GreenLawn orders 4 lawn mowers. (1) What is the expected demand? 2. 3 4 5 GreenLawn purchases the lawn mowers at $3,000 per unit, sells them at $4,250 per unit, and liquidates surplus (= not sold during March-September) lawn mowers in October for $2,500 per unit. (2) What is the expected quantity of sales? (3) What is the expected quantity of leftovers? Probability 10% (4) What is the expected quantity of unmet demand? 10 Expected (5) What is GreenLawn's in-stock rate or service level (in percentage)? 15% 30% 20% 15% 10% (6) What is GreenLawn's fill rate (in percentage)? Choose the nearest integer. You will want to populate the table below to help you answer the questions above. Sales Probability (%) 10 15 30 20 15 Demand 0 1 2 3 4 5 Leftover Unmet Demand (1) (1) eee (1) (b) According to the newsvendor model, the optimal order quantity is the smallest Q such that P(D
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