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The selling season for ski jacket is about 16 weeks. A sportswear store is trying to decide the quantity of ski jacket for the upcoming selling season. The unit cost of each jacket is $76, and the retail price is $156. A discount store purchases any leftover jacket at the end of season for $23 each. Before the start of the sales season, the buyer forecasts weekly demand to be normally distributed, with a mean of 120 and a standard deviation of 25. Let's compare the following two ordering options in terms of order quantity and expected season profit: Option 1: supply lead time is 16 weeks. Consequently, a single order must be placed at the beginning of the season to cover the entire season demand. Option 2: supply lead time is reduced by half to 8 weeks. Consequently, two orders can be placed for the season, one to be delivered at the beginning of the season, and the other to be placed at the end of week 1 and delivered at the beginning of week 10 to cover the demand for the last 7 weeks. In addition, the buyer's demand forecast accuracy of the 2nd order will be improved due to the realized demand during week 1. As a result, the Option 2: supply lead time is reduced by half to 8 weeks. Consequently, two orders can be placed for the season, one to be delivered at the beginning of the season, and the other to be placed at the end of week 1 and delivered at the beginning of week 10 to cover the demand for the last 7 weeks. In addition, the buyer's demand forecast accuracy of the 2nd order will be improved due to the realized demand during week 1. As a result, the weekly demand standard deviation is dramatically reduced. Assume the demand is independent across weeks. The following table gives the expected profits and expected overstock and under- stock in option 2's two selling seasons. Option 2: Option 2: 1st selling 2nd selling season season Expected profit $7,070 $4,823 Expected 54 27 overstock Expected under- 13 7 stock What is the expected profit for Option 2? Input should be an exact number. The selling season for ski jacket is about 16 weeks. A sportswear store is trying to decide the quantity of ski jacket for the upcoming selling season. The unit cost of each jacket is $76, and the retail price is $156. A discount store purchases any leftover jacket at the end of season for $23 each. Before the start of the sales season, the buyer forecasts weekly demand to be normally distributed, with a mean of 120 and a standard deviation of 25. Let's compare the following two ordering options in terms of order quantity and expected season profit: Option 1: supply lead time is 16 weeks. Consequently, a single order must be placed at the beginning of the season to cover the entire season demand. Option 2: supply lead time is reduced by half to 8 weeks. Consequently, two orders can be placed for the season, one to be delivered at the beginning of the season, and the other to be placed at the end of week 1 and delivered at the beginning of week 10 to cover the demand for the last 7 weeks. In addition, the buyer's demand forecast accuracy of the 2nd order will be improved due to the realized demand during week 1. As a result, the Option 2: supply lead time is reduced by half to 8 weeks. Consequently, two orders can be placed for the season, one to be delivered at the beginning of the season, and the other to be placed at the end of week 1 and delivered at the beginning of week 10 to cover the demand for the last 7 weeks. In addition, the buyer's demand forecast accuracy of the 2nd order will be improved due to the realized demand during week 1. As a result, the weekly demand standard deviation is dramatically reduced. Assume the demand is independent across weeks. The following table gives the expected profits and expected overstock and under- stock in option 2's two selling seasons. Option 2: Option 2: 1st selling 2nd selling season season Expected profit $7,070 $4,823 Expected 54 27 overstock Expected under- 13 7 stock What is the expected profit for Option 2? Input should be an exact number

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