Refer to Exercise 22.11. The owner has assigned the following

Best Writers study-help Refer to Exercise 22.11. The owner has assigned the following

study-help

Refer to Exercise 22.11. The owner has assigned the following

Question
Refer to Exercise 22.11. The owner has assigned the following probabilities: P(Demand = 100) = .2, P(Demand = 150) = .25, P(Demand = 200) = .40, P(Demand = 250) = .15 Find the EMV decision. The owner of a clothing store must decide how many men’s shirts to order for the new season. For a particular type of shirt, she must order in quantities of 100 shirts. If she orders 100 shirts, her cost is $10 per shirt; if she orders 200 shirts, her cost is $9 per shirt; and if she orders 300 or more shirts, her cost is $8.50 per shirt. Her selling price for the shirt is $12, but any shirts that remain unsold at the end of the season are sold at her famous “halfprice, end-of-season sale.” For the sake of simplicity, she is willing to assume that the demand for this type of shirt will be 100, 150, 200, or 250 shirts. Of course, she cannot sell more shirts than she She is also willing to assume that she will suffer no loss of among her customers if she under and the customers cannot buy all the shirts they want. Furthermore, she must place her order today for the entire season; she cannot wait to see how the demand is running for this type of shirt.
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