Question
The cafeteria offers scones for $1.50 each from 8 am to 3 pm. The scones are ordered from their supplier at the start of each
The cafeteria offers scones for $1.50 each from 8 am to 3 pm. The scones are ordered from their supplier at the start of each day and delivered before the store opens. The supplier charges 75 cents per scone. If, at 3 pm, some scones are left unsold, they are sold back to the supplier for 50 cents each. If a customer asks for a scone before 3 pm but the cafeteria has run out, the customer always buys a bag of chips for $1 instead. (Assume the chips are always in stock and they are purchased from the same supplier for 40 cents each.) Demand for scones before 3 pm at the cafeteria is variable but can only take values between 40 and 50, with probabilities given in the following table.
Number of customers Probability 40 0.05 41 0.05 42 0.15 43 0.2 44 0.15 45 0.1 46 0.1 47 0.1 48 0.05 49 0.025 50 0.025Step by Step Solution
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