Alabama pins commemorating the 2009 National Championship game are purchased in multiples of 100 for your college organization at $1.50 each. When sold during the event the selling price is $5. After the event their salvage value is just $0.25.
From past events (many years ago!!!!) you calculate the probability of selling different quantities of pins within a range from 200 to 500:
Customer Demand 200 300 400 500
Prob. Of Occurrence .35 .20 .10 .35
a.) How many pins should you buy and have on hand for the event? (Use excel and show your formulas with Ctrl~)
b.) Does the decision change if you exchange the probabilities for 400 and 500? If so, what is the change?