What is optimal number of hot dogs and buns adrian purchase


Problem

As the director of concessions at Kenan Stadium, Adrian is responsible for ordering items for the concession stands to ensure there is sufficient supply for game day. Past experience suggests he can assume game day demand for hot dogs follows a normal distribution with an average of 10,000 and a standard deviation of 500. The concession stand sells hot dogs to fans for $5. The price of the hot dog is $0.60 each and the cost of the buns cost $0.18 each. There is an associated miscellaneous cost of $0.42 for each hot dog that's sold (condiments, a pinks, etc). Hot dog buns that aren't sold can be returned to the supplier for a credit of $0.09 each. There is no opportunity to return the unsold hot dogs.

• Based on the information above, what is the optimal number of hot dogs and buns Adrian should purchase for each home game?

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Financial Accounting: What is optimal number of hot dogs and buns adrian purchase
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