Teresa Granger is the manager of Chicago Cheese, which produces cheese spreads and other cheese-related products. E-Z

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Teresa Granger is the manager of Chicago Cheese, which produces cheese spreads and other cheese-related products. E-Z Spread Cheese is a product that has always been popular. The probability of sales, in cases, is as follows:

DEMAND (CASES) PROBABILITY

10 ..............0.2

11 ..............0.3

12 ..............0.2

13 ..............0.2

14 ..............0.1

A case of E-Z Spread Cheese sells for $100 and has a cost of $75. Any cheese that is not sold by the end of the week is sold to a local food processor for $50.

Teresa never sells cheese that is more than a week old. Use marginal analysis to determine how many cases of E-Z Spread Cheese to produce each week to maximize average profit.


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Quantitative Analysis For Management

ISBN: 162

11th Edition

Authors: Barry Render, Ralph M. Stair, Michael E. Hanna

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