Each day, the manager of a local bookstore must decide how many copies of the community newspaper to order for sale in her shop. She must pay the newspaper’s publisher $0.40 for each copy, and she...


Each day, the manager of a local bookstore must decide how many copies of the community newspaper to order for sale in her shop. She must pay the newspaper’s publisher $0.40 for each copy, and she sells the newspapers to local residents for $0.50 each. Newspapers that are unsold at the end of day are considered worthless. The probability distribution of the number of copies of the newspaper purchased daily at her shop is provided in the file P10_41.xlsx. Employ a decision tree to find the bookstore manager’s profit-maximizing daily order quantity.



May 22, 2022
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