Question
You are a retaller selling sweat pants. The retail price is 100. You order them from your supplier for 77. At the end of the
You are a retaller selling sweat pants. The retail price is 100. You order them from your supplier for 77. At the end of the season, if you have any leftover. you will discount them and sell at a discounted price 61. You estimate the goodwill cost, in case a customer comes to the store and you are out of sweatpants to be 25. You think that during the selling season the demand is Normal with the mean of 500 and the standard deviation of 40. The Cost of Underage (CU) is ______ The Cost of Overage (CO) is ______ The critical ratio is _______ . The optimal order amount (Q) is ________ Suppose that you think that the desired service level should be about 90%. What would the approximate discounted price have to be for 90% to be the optimal service level? _________
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