 
Summary: ISyE 3232 Exam # 1
Fall 2007
Name
Please be neat and show all your work so that I can give you partial credit.
GOOD LUCK.
Question 1
Question 2
Question 3
Total
1
(20) 1. Suppose that a bakery specializes in chocolate cakes. Assume the cakes
retail at $20 per cake, but it takes $8 to prepare each cake. Cakes cannot be
sold after one week, and they have a negligible salvage value. It is estimated
that the weekly demand for cakes is: 15 cakes in 10% of the weeks, 16 cakes in
15% of the weeks, 17 cakes in 30% of the weeks, 18 cakes in 20% of the weeks,
19 cakes in 15% of the weeks, and 20 cakes in 10% of the weeks.
(10) a. How many cakes should the bakery prepare each week to maximize its
expected profit?
(20) b. What is the bakery's expected optimal weekly profit?
2
