Jenny is planning to open a merchandise stand outside the upcoming Taylor Swift concert in Atlanta. Jenny buys sunglasses (see below) online for $10 each, and she will be selling the sunglasses to con- certgoers for $16 each. If there are any sunglasses left unsold after the concert, Jenny will sell them to a recycling center for $1 each. The demand for these sunglasses at the concert is given by a discrete uniform distribution over the interval (51,250] (meaning that the demand random variable takes each of the values 51,52,53,...,250 with equal probability). (a) (10 points) What is Jenny's optimal newsvendor order quantity? (b) (5 points) Before placing the order, Jenny discovered that she already had 75 units in storage. What is her optimal order quantity now? (c) (5 points) What would be her optimal order quantity if she instead found 175 units in storage?
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