Scenario 13.1 - Nefarious

question 87

Multiple Choice

Scenario 13.1 - Nefarious
The tenured professor routinely led student groups on factory tours in exotic locales,and one popular destination was an island south of Miami.The students enjoyed this happy little island and the professor liked it because he could supplement his income by bringing back a few boxes souvenirs he could sell to his friends.The souvenirs cost the professor $125 a box and he sells them for $290 a box.Souvenirs that dry out due to age can be sold for $80.Experience has shown that the demand for boxes of these souvenirs has a mean of 80 with a standard deviation of 20.
-Naturally,the professor will purchase the optimal number of boxes.(He's had a course or two in supply chain management and knows this model well. ) If each of his friends purchases only one box,how many friends will he turn away because he runs out of boxes of souvenirs?

• A)5
• B)3
• C)2
• D)1

---

Definitions:

Required Return

The minimum expected return by investors for investing in a particular asset, considering its risk profile.

Expected Return

It is the anticipated return on an investment, considering all possible outcomes and their probabilities.

Expected Return

The forecasted percentage return on an investment, accounting for all possible returns and their probabilities.

Currently Available Information

The latest and most up-to-date data or facts that are accessible and can be used for decision-making processes.