Exhibit 2-1 a T-Shirt Company Is Planning a Production Run for an for an Event

Essay

Exhibit 2-1
A t-shirt company is planning a production run for an event where the attendance (and thus demand for t-shirts) is uncertain. The event planners have indicated that they think the attendance will be 500, 750 or 1000, with probabilities of 30%, 50% and 20% respectively. The company must pre-order the blank t-shirts (cost=$5 per shirt) and it can sell finished shirts for $12 apiece. Any finished shirts that cannot be sold at the event can be sold for $2 apiece to a used clothing vendor.
-Refer to Exhibit 2-1.Suppose that blank t-shirts can only be ordered from the wholesale vendor in batches of 100
How many t-shirts should the company order