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MC Question 4
The Mobile Sandwich Co prepares sandwiches which it delivers and sells to employees at local businesses each day.
Demand varies between 325 and 400 sandwiches each day. As the day progresses, the price of the sandwiches is reduced and, at the end of the day, any sandwiches not sold are thrown away. The company has prepared a regret table to show the amount of profit which would be foregone each day at each supply level, given the varying daily levels of demand.
Regret table
| Daily supply of sandwiches (units) | |||||
|---|---|---|---|---|---|
| 325 | 350 | 375 | 400 | ||
| 325 | $0 | $21 | $82 | $120 | |
| Daily demand | 350 | $36 | $0 | $44 | $78 |
| for sandwiches (units) | 375 | $82 | $40 | $0 | $34 |
| 400 | $142 | $90 | $52 | $0 |
Applying the decision criterion of minimax regret, how many sandwiches should the company decide to supply each day?
A. 325
B. 350
C. 375
D. 400