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lisabon 2012 [21]
3 years ago
7

A newsvendor orders the quantity that maximizes expected profit for two products, X and Y. The critical ratio for both products

is 0.8. The demand forecast for both products is 9,000 units and both are normally distributed. Product X has more uncertain demand in the sense that it has the larger standard deviation. Of which of the two products does the newsvendor order more
A. Product A, because it has less certain demand.
B. Product B, because it has more certain demand.
C. The order quantities are the same because they have the same critical ratio.
D. More information is needed to determine which has the higher order quantity.
Business
2 answers:
Naily [24]3 years ago
7 0

Answer:

Take note that you used X and Y as the name of the two products but the options provided was changed to product A and B. Not withstanding, it doesn't affect the answer.

The correct answer is option (A) Product A, because it has less certain demand

Explanation:

A. Product A, because it has less certain demand.

Explanation:

Product X and Y both have the same critical ratio and both are normally distributed. Although, the demand for product X is uncertain but due to it's  large standard deviation of demand, the optimal order quantity is greater.

When a product has uncertain demand, it means that the seller can not predict the rate of demand of that product by the consumers.

Uncertain demands helps sellers to maximize profit or minimize cost.

In order to maximize profit, uncertain demand is put into consideration by the news vendor.

Tamiku [17]3 years ago
5 0

Answer:

A. Product A, because it has less certain demand.

Explanation:

According to the statement, the product X (A) is the one with the highest proportion of standard deviation, that is, it has a more uncertain demand. Taking into account this condition, it is expected that the number of optimal products will be greater because it has an average and critical relationship. For this reason, it is expected that the news seller will lean towards the first product, since it will generate higher income as explained at the beginning.

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Assume Dell's yearly inventory cost is 30 percent to account for the cost of capital for financing the inventory, the warehouse
JulijaS [17]

Answer:

See below

Explanation

1. Value of inventory sold

= $280 million in inventory + COGS $23,100 million

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2. Cost of goods sold

From the above passage, we have been given the COGS , which is $23,100 million

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A7X Corporation has ending inventory of $701,073 and cost of goods sold for the year just ended was $7,461,613. a. What is the i
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Answer:

(A) Inventory turnover= 10.64 times

(B) Days sales in inventory= 34.30 says

(C) Shelf life= 34.30 days

Explanation:

A7X corporation has an ending inventory of $701,073

The cost of goods sold for the year is $7,461,613

(A) The inventory turn over can be calculated as follows

= cost of goods sold/ending inventory

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(B) The day sales in inventory can be calculated as follows

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3 years ago
CIRP. Jason Smith is a foreign exchange trader with Citibank. He notices the following quotes. Spot exchange rate SFr1.6627/$ Si
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Answer:

Answer explained below

Explanation:

A.

For six months, rSFr => 1.50% and r$ => 1.75%.

Since the exchange rate is in SFr/$ terms, the appropriate expression for the interest rate parity relation is

F/S => [ (1 +  rSFr ) / ( 1 + r$) ]

then we can also say

F/S *( 1 + r$) => (1 +  rSFr )

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B and C.

Since IRP is not holding, there is an arbitrage possibility.

As 1.0133 < 1.0150,

we can say that the EuroSFr quote is more than what it should be as per the quotes for the other three variables. And, we can also say that the Euro$ quote is less than what it should be as per the quotes for the other three variables. Therefore, the arbitrage strategy should be based on borrowing in the Euro$ market and lending in the SFr market. The steps are as as follows. -

Borrow $1000000 for six-months at 3.5% per year and then we will pay back

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Lend SFr 1662700 for six-months at 3% per year. Will get back

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Sell SFr 1687641 six months forward. The transaction will be contracted as of the current date but delivery and settlement will only take place six months later. So, sixmonths later exchange

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Answer:

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