Assignment
Seoul National University
Supply Chain Management
May 11 – May 22, 2015
Homework Assignment
Completed assignment is due at the start of Session 7 on Tuesday, May 19.
This assignment is to be completed in a group of 2 or 3 students. Submit a hard copy, not an electronic copy (typed answers are preferred). Show your work clearly and explain your reasoning in detail. You will not receive a credit if the instructor cannot understand what you have done because of insufficient explanation.
(Q1-Q2) Teddy Bower the Newsvendor
(To answer these two questions, use the Standard Normal Distribution Function Table; one of the purposes of these questions is to give you a hands-on experience in using the table, which you will need to do in the final exam.)
Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $10 each from its Asian supplier, TeddySports. Teddy Bower forecasts that its demand is normally distributed with mean of 2,100 and standard deviation of 1,200. Teddy Bower sells these parkas at $22 each. Unsold parkas have zero salvage value.
1. How many parkas should Teddy Bower buy from TeddySports to maximize expected profit?
2. If Teddy Bower wishes to ensure a 98.5 percent in-stock probability, how many parkas should it order?
(Q3-Q7) Parka production planning
(Review the Sport Obermeyer case analysis to answer these questions. For these questions you do not need to use the Standard Normal Distribution Function Table or Excel spreadsheet formula, since all relevant data are already computed and provided to you in the table below.)
A firm sells five women’s ski parkas. The demand for each parka is normally distributed with mean and standard deviation . Data on these five parkas are listed below:
Parka
A
B
C
D
E
Price
$220
$205
$190
$175
$160
1,000
2,000
3,000
2,000
1,000
300
800
1500
1200
700
Co
35.2
28.7
22.8
17.5
12.8
1
Cu
52.8
49.2
45.6
42.0
38.4
Q
1,076
2,269
3,646
2,650
1,472
Expected
Newsvendor
Profit
Supply Chain Management
May 11 – May 22, 2015
Homework Assignment
Completed assignment is due at the start of Session 7 on Tuesday, May 19.
This assignment is to be completed in a group of 2 or 3 students. Submit a hard copy, not an electronic copy (typed answers are preferred). Show your work clearly and explain your reasoning in detail. You will not receive a credit if the instructor cannot understand what you have done because of insufficient explanation.
(Q1-Q2) Teddy Bower the Newsvendor
(To answer these two questions, use the Standard Normal Distribution Function Table; one of the purposes of these questions is to give you a hands-on experience in using the table, which you will need to do in the final exam.)
Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $10 each from its Asian supplier, TeddySports. Teddy Bower forecasts that its demand is normally distributed with mean of 2,100 and standard deviation of 1,200. Teddy Bower sells these parkas at $22 each. Unsold parkas have zero salvage value.
1. How many parkas should Teddy Bower buy from TeddySports to maximize expected profit?
2. If Teddy Bower wishes to ensure a 98.5 percent in-stock probability, how many parkas should it order?
(Q3-Q7) Parka production planning
(Review the Sport Obermeyer case analysis to answer these questions. For these questions you do not need to use the Standard Normal Distribution Function Table or Excel spreadsheet formula, since all relevant data are already computed and provided to you in the table below.)
A firm sells five women’s ski parkas. The demand for each parka is normally distributed with mean and standard deviation . Data on these five parkas are listed below:
Parka
A
B
C
D
E
Price
$220
$205
$190
$175
$160
1,000
2,000
3,000
2,000
1,000
300
800
1500
1200
700
Co
35.2
28.7
22.8
17.5
12.8
1
Cu
52.8
49.2
45.6
42.0
38.4
Q
1,076
2,269
3,646
2,650
1,472
Expected
Newsvendor
Profit