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Rick Miller has just opened a new bakery in Frisco, Colorado, called Morning Fresh. In performing an economic analysis, Rick has determined that the marginal cost or loss for each dozen doughnuts sold is $4. The marginal profit is estimated to be $2.75 per dozen doughnuts. At this time, Rick is considering stocking 10, 15, 20, 25 or 30 dozen doughnuts. The probability of selling 10 dozen doughnuts is 10%. The chance of selling 15 Dozen doughnuts is 20%. There is a 30% chance that Morning Fresh will sell either 20 or 25 dozen doughnuts. Finally, there is a 10% chance of selling 30 dozen doughnuts, which is considered by Rick to be the most that Morning Fresh would be able to accommodate. What is your recommendation to Rick ?

Rick Miller has just opened a new bakery in Frisco, Colorado, called Morning Fresh. In performing an economic analysis, Rick has determined that the marginal cost or loss for each dozen doughnuts sold is $4. The marginal profit is estimated to be $2.75 per dozen doughnuts. At this time, Rick is considering stocking 10, 15, 20, 25 or 30 dozen doughnuts. The probability of selling 10 dozen doughnuts is 10%. The chance of selling 15 Dozen doughnuts is 20%. There is a 30% chance that Morning Fresh will sell either 20 or 25 dozen doughnuts. Finally, there is a 10% chance of selling 30 dozen doughnuts, which is considered by Rick to be the most that Morning Fresh would be able to accommodate. What is your recommendation to Rick ?

Holt Mcdougal Larson Pre-algebra: Student Edition 2012
Holt Mcdougal Larson Pre-algebra: Student Edition 2012
1st Edition
ISBN:9780547587776
Author:HOLT MCDOUGAL
Publisher:HOLT MCDOUGAL
Chapter6: Ratio, Proportion, And Probability
Section: Chapter Questions
Problem 4CR
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Rick Miller has just opened a new bakery in Frisco, Colorado, called Morning Fresh. In performing an economic analysis, Rick has determined that the marginal cost or loss for each dozen doughnuts sold is $4. The marginal profit is estimated to be $2.75 per dozen doughnuts. At this time, Rick is considering stocking 10, 15, 20, 25 or 30 dozen doughnuts. The probability of selling 10 dozen doughnuts is 10%. The chance of selling 15 Dozen doughnuts is 20%. There is a 30% chance that Morning Fresh will sell either 20 or 25 dozen doughnuts. Finally, there is a 10% chance of selling 30 dozen doughnuts, which is considered by Rick to be the most that Morning Fresh would be able to accommodate. What is your recommendation to Rick ?
Transcribed Image Text:Rick Miller has just opened a new bakery in Frisco, Colorado, called Morning Fresh. In performing an economic analysis, Rick has determined that the marginal cost or loss for each dozen doughnuts sold is $4. The marginal profit is estimated to be $2.75 per dozen doughnuts. At this time, Rick is considering stocking 10, 15, 20, 25 or 30 dozen doughnuts. The probability of selling 10 dozen doughnuts is 10%. The chance of selling 15 Dozen doughnuts is 20%. There is a 30% chance that Morning Fresh will sell either 20 or 25 dozen doughnuts. Finally, there is a 10% chance of selling 30 dozen doughnuts, which is considered by Rick to be the most that Morning Fresh would be able to accommodate. What is your recommendation to Rick ?
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