question archive A furniture store chain with 25 stores is stocking a fashionable chair in each of their stores with a normal demand distribution with a mean of 250 and a standard deviation of 125

A furniture store chain with 25 stores is stocking a fashionable chair in each of their stores with a normal demand distribution with a mean of 250 and a standard deviation of 125

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A furniture store chain with 25 stores is stocking a fashionable chair

in each of their stores with a normal demand distribution with a mean of 250 and a standard deviation of 125.  The cost of the chair is $750, and it is sold for $1,500. Chairs that are not sold by the end of the season are sold for $250 per chair. If you would like partial credit, please show your work and the assumptions you made.

-What are the values of cu and co?                                         (2 points))
-What is the optimal service level for an individual store?                          (2 points)
-What is the Z value?                                                                                        (2 points)
-What is the optimal purchasing quantity for an individual store?             (3 points)
-What is the probability of having some shortage at an individual store?            (4 points)
-If the chain is purchasing and keeping the chairs centrally (for all 25 stores), what is the demand distribution at the center?                (5 points)
-If the chain is purchasing and keeping the chairs centrally (for all 25 stores), what is the optimal order quantity?                                   (3 points)
-What is the probability of having some shortage at the center??

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