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Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $ 1 2 each from its Asian supplier, TeddySports.

Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $12 each from its Asian supplier,
TeddySports. Unfortunately, at the time of the order placement, demand is still uncertain: Teddy Bower forecasts that its demand is
normally distributed with a mean of 1,800 and a standard deviation of 1,300. Teddy Bower sells these parkas at $19 each. Unsold
parkas have little salvage value; Teddy Bower simply gives them away to a charity (and also doesn't collect a tax benefit for the
donation). Use Table 13.4.
Note: Do not round intermediate calculations. If a part of the question specifies whether to use Table 13.4, or to use Excel, then
credit for a correct answer will depend on using the specified method.
a) How many parkas should Teddy Bower buy from TeddySports to maximize expected profit? Use Table 13.4 and the round-up rule.
b) If Teddy Bower orders 2,500 parkas, what is expected leftover inventory? Use Table 13.4 and the round-up rule.
c) If Teddy Bower orders 2,500 parkas, what is expected sales? Use your result from Part b
d) If Teddy Bower orders 2,500 parkas, what is expected profit? Use your results from Part b and Part c.
e) How many parkas should Teddy Bower order to ensure a 98.5% in-stock probability? How many parkas should Teddy Bower's order? Use
Table 13.4.
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