Flag Sport Obermeyer (SO) is a manufacturer of ski apparel. A ski jacket is sourced at a cost of $80 and sold for $125.
Posted: Wed Apr 27, 2022 1:47 pm
Flag Sport Obermeyer (SO) is a manufacturer of ski apparel. A
ski jacket is sourced at a cost of $80 and sold for $125. One order
is placed at the beginning of the season. Currently, SO disposes of
any unsold jackets at the end of the season to outlet stores at
$70. It costs $10 to hold a jacket in inventory for the entire
season and then ship it to an outlet store. Demand for ski jackets
has been forecast to be normally distributed, with a mean of 4,000
and standard deviation of 1,750.
What is the expected overstock at the end of the season
that will be sent to outlet stores?
ski jacket is sourced at a cost of $80 and sold for $125. One order
is placed at the beginning of the season. Currently, SO disposes of
any unsold jackets at the end of the season to outlet stores at
$70. It costs $10 to hold a jacket in inventory for the entire
season and then ship it to an outlet store. Demand for ski jackets
has been forecast to be normally distributed, with a mean of 4,000
and standard deviation of 1,750.
What is the expected overstock at the end of the season
that will be sent to outlet stores?