Problem:
Due to long lead times, fashion goods must usually be purchased by retail stores long before the season begins, and "hot" items quite often cannot be ordered again during the season once their popularity becomes evident. The new, trendy aluminum foil dress is creating a buzz. Getting a consen sus of opinion as to potential sales, the predicted average sales are 5,000 dresses per store chainwide, but with a high variance. Assume potential sales are normally distributed with a standard deviation of 1,500. The dresses cost $40 and can be sold for $120. Unsold dresses can be sold at the end of the season to discount stores for $10.
Required:
Question 1) How many should be ordered?
Solve the given numerical problem and illustrate step by step calculation.