Continuing Problem 6, create a two-way data table for expected profit with order quantity along the side and unit expediting cost along the top. Allow the order quantity to vary from 500 to 4500 in...

Continuing Problem 6, create a two-way data table for expected profit with order quantity along the side and unit expediting cost along the top. Allow the order quantity to vary from 500 to 4500 in increments of 500, and allow the unit expediting cost to vary from $36 to $45 in increments of $1. Each column of this table will allow you to choose a “best” order quantity for a given unit expediting cost. How does this best order quantity change as the unit expediting cost increases? Write up your results in a concise memo to management. (Hint: You have to modify the existing spreadsheet model so that there is a cell for expected profit that changes automatically when you change either the order quantity or the unit expediting cost. See Problem 8 for guidelines.)

Problem 6

In some ordering problems, like the one for Sam’s Bookstore, whenever demand exceeds existing inventory, the excess demand is not lost but is filled by expedited orders—at a premium cost to the company. Change Sam’s model to reflect this behavior. Assume that the unit cost of expediting is $40, well above the highest “regular” unit cost.