#5 5. value: 1.00 points Conceptual Question 13-2 A newsvendor orders the... A n

Question

#5

5. value: 1.00 points Conceptual Question 13-2 A newsvendor orders the... A newsvendor orders the quantity that maximizes expected profit for two products, A and B. 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 A 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? °Product A, because it has less certain demand. OProduct B, because it has more certain demand. OThe order quantities are the same because they have the same critical ratio. °More information is needed to determine which has the higher order quantity

Explanation / Answer

The correct Answer is- Product A because it has less certain demand.

Reason:- Given the uncertain demand, the vendor can plan to reorder more in anticipation of higher future demand.

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.