A restaurant prepares Peking Duck daily at a cost of $18 per duck.Each duck generates revenue of $47 if sold.Demand for Peking Duck can be described by a Poisson distribution with a mean of 4.2 ducks per day.Unsold ducks at the end of each day are converted to duck soup at an additional cost of $5 over and above the resulting value as soup.How many ducks should be prepared each day? What will be the effective service level?

Question

Quizplus · Accepted Answer

The Answer of A restaurant prepares Peking Duck daily at a cost of $18 per duck.Each duck generates revenue of $47 if sold.Demand for Peking Duck can be described by a Poisson distribution with a mean of 4.2 ducks per day.Unsold ducks at the end of each day are converted to duck soup at an additional cost of $5 over and above the resulting value as soup.How many ducks should be prepared each day? What will be the effective service level?

A Restaurant Prepares Peking Duck Daily at a Cost of $18