Submitted by: Submitted by monomani
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Category: Business and Industry
Date Submitted: 12/31/2010 06:28 PM
Hamptonshire Express Case
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Problem 1
1a) Using the model “Hamptonshire Express: Problem 1,” Xxx calculated the optimal stocking quantity to be 584 newspapers, which is expected to produce daily profit of $331.4364. A quantity of 583 newspapers produces a expected daily profit of $331.4353 and a quantity of 585 newspapers produces an expected daily profit of $331.4347. The model inputs and a sensitivity analysis are shown below:
Stocking Quantity | Expected Profit/day |
580 | $ 331.415 |
581 | $ 331.425 |
582 | $ 331.431 |
583 | $ 331.435 |
584 | $ 331.436 |
585 | $ 331.435 |
586 | $ 331.430 |
587 | $ 331.423 |
588 | $ 331.413 |
589 | $ 331.400 |
590 | $ 331.385 |
1b) The value derived in part (a) is consistent with the optimal stocking quantity in the newsvendor model as demonstrated by the calculations below:
INSERT CALCULATIONS – David?
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Problem 2
a) Using the model “Hamptonshire Express: Problem 2,” Xxx calculated via trial and error that the expected profit/day is highest for when the number of hours invested equals four (h=4). The model parameters are shown below as well as a summary of the results of the trial and error analysis.
#hrs | Expected Profit/day |
2 | $ 367.91 |
2.25 | $ 368.84 |
2.5 | $ 369.58 |
2.75 | $ 370.17 |
3 | $ 370.61 |
3.25 | $ 370.94 |
3.5 | $ 371.16 |
3.75 | $ 371.29...