Question
Read the Harvard Business School Sport Obermeyer Ltd. case study. Assume the following. Make additional justifiable assumptions if necessary. For any style, the profit is
Read the Harvard Business School Sport Obermeyer Ltd. case study.
Assume the following. Make additional justifiable assumptions if necessary.
For any style, the profit is 24% of the wholesale price, and the loss of unsold units is 8% of the wholesale price in Exhibit 10.
For any style, the demand follows a Normal distribution; the demand mean is equal to the average forecast in Exhibit 10, and the demand standard deviation is equal to 2 times the forecast standard deviation in Exhibit 10 (found in case study on page 19).
Assume all 10 styles are only produced in Hong Kong (i.e., the minimum order quantity for each style is 600 units)
1. Without considering the production phases or the Las Vegas show, what is the optimal production quantity of each style?
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