Scenario C.2
Kyle store sells K2 skis.The store makes a $200 profit per unit sold during the ski season,but it will take a $50 loss per unit if sold after the season is over.The following discrete probability distribution has been estimated for the season's demand.

-Use the information in Scenario C.2.What is the best order quantity?
A)fewer than or equal to 20 units
B)greater than 20 units but fewer than or equal to 40 units
C)greater than 40 units but fewer than or equal to 50 units
D)greater than 50 units

Question

Scenario C.2
Kyle store sells K2 skis.The store makes a $200 profit per unit sold during the ski season,but it will take a $50 loss per unit if sold after the season is over.The following discrete probability distribution has been estimated for the season's demand.
 
-Use the information in Scenario C.2.What is the best order quantity?
A)fewer than or equal to 20 units 
B)greater than 20 units but fewer than or equal to 40 units 
C)greater than 40 units but fewer than or equal to 50 units 
D)greater than 50 units

Quizplus · Accepted Answer

The best order quantity is determined by balancing the costs of ordering and holding inventory. Based on Scenario C.2, the optimal order quantity falls between 20 and 40 units, likely due to minimizing total costs while meeting demand.

Scenario C.2 Kyle Store Sells K2 Skis.The Store Makes a $200 Profit