Degan routinely drove the 400-mile round trip to his favorite grocery store to stock up on bread, which cost $1.50 per loaf

Running out would be disastrous — an unplanned trip to this store would mean a custom order that would run $7.75 per loaf. Overstocking wasn't a big issue, he could sell it to his teaching partner for $0.10 per loaf. With a demand that is normally distributed with a mean of 125 and standard deviation of 15, what is Degan's optimal purchase quantity on his next trip to the store?
A) 139
B) 173
C) 115
D) 128

Answer: A

Business

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