Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Goop Inc. needs to order a raw material to make a special polymer. The demand for the polymer is forecasted to be normally distributed with

Goop Inc. needs to order a raw material to make a special polymer. The demand for the polymer is forecasted to be normally distributed with a mean of 253 gallons and a standard deviation of 126 gallons. Goop sells the polymer for $25 per gallon. Goop purchases raw material for $10 per gallon and must spend $5 per gallon to dispose of all unused raw material due to government regulations. (One gallon of raw material yields one gallon of polymer.) If demand is more than Goop can make, then Goop sells only what it has made and the rest of the demand is lost.

Suppose Goop wants to ensure that there is a 92% probability that they will be able to satisfy the customers entire demand. How many gallons of raw material should they purchase?

I need typed answer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Strategic Management A Competitive Advantage Approach Concepts

Authors: Fred R. David, Forest R. David

15th edition

978-0133444896, 133444791, 9780133444858, 133444899, 133444856, 978-0133444797

More Books

Students also viewed these General Management questions