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linda_us, Master's Degree

Category: Multiple Problems

Satisfied Customers: 1402

Experience: A tutor for Business, Finance, Accounts and other related topics.

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It seems you had answered this problem earlier but now the

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Hi it seems you had answered this problem earlier but now the Link is not valid so im posting the problem again. A publisher sells books to Borders at $12 each. The marginal production cost for thepublisher is $1 per book. Borders prices the book to its customers at $24 and expects demand over the next two months to be normally distributed, with a mean of 20,000 and a standard deviation of 5,000. Borders places a single order with the publisher for delivery at the beginning of the two-month period. Currently, Borders discounts any unsold books at the end of two months down to $3, and any books that did not sell at full price sell at this price.(a) How many books should Borders order? What is its expected proﬁt? How many books does it expect to sell at a discount?(b) What is the proﬁt that the publisher makes given Borders’ actions?(c) A plan under discussion is for the publisher to refund Borders $5 per book that does not sell during the two-month period. As before, Borders will discount them to $3 and sell any that remain. Under this plan, how many books will Borders order? What is the expected proﬁt for Borders? How many books are expected to be unsold? What is the expected proﬁt for the publisher? Should the publisher agree to use this new plan? http://www.justanswer.com/multiple-problems/6tulv-question-1-basic-newsboy-a-publisher-sells-books-borders.html Similar to the above the problem JA: Thanks. Can you give me any more details about your issue? Customer: I cannot solve the part where it says expected number of books to be sold at a discount. Is that just the saftey stock ?\ i dont think so so im getting a bit confused with that part JA: OK got it. Last thing — Business Tutors generally expect a deposit of about $18 to help with your type of question (you only pay if satisfied). Now I'm going to take you to a page to place a secure deposit with JustAnswer. Don't worry, this chat is saved. After that, we will finish helping you.