Question
In the previous problem, the manufacturer performs additional market research. based on this research, they determine that they can increase the price to $150 and
In the previous problem, the manufacturer performs additional market research. based on this research, they determine that they can increase the price to $150 and are able to reduce the standard deviation of the forecast to s=30. at the same time, they have made an arrangement with an outlet store that will purchase unsold equipment for $60 each (hint: the disposal value is $60). other parameters are the same as those in the previous problem. specifically, each unit costs $75 to manufacture and it costs $10 to hold a unit of unsold item in the inventory for the entire season. demand is normally distributed with a mean of u=100. what is the expected profit?
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