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Ethical sourcing (ES) sells coffee for the holiday season. The same coffee is sold in three specially designed boxes. Currently all packaging is done in
Ethical sourcing (ES) sells coffee for the holiday season. The same coffee is sold in three specially designed boxes. Currently all packaging is done in the plant as the coffee is manufactured. All manufacturing and packaging for the holiday season are completed before the start of the season. The demand forecast for the most popular design is normally distributed with mean 50,000 and standard deviation of 7,000. The demand for the two less popular designs is normally distributed, with a mean of 20,000 and a standard deviation of 8,000. Each box (including coffee) costs $10 and is sold for $20. Any unsold boxes at the end of the season are discounted to $8, and they all sell out at this price. The cost of holding a box in inventory for the entire season before selling it at a discount is $1
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