Joe\'s Coffee Shoppe orders fresh doughnuts each morning. Joe pays $3.20 per dozen doughnuts and sell doughnuts for $0.4 each. The leftover doughnuts are salvaged at half the selling price. Suppose that the demand for doughnuts is uniformly distributed from 16 dozens to 30 dozens. How many doughnuts (in dozens) should Joe stock each day? A detailed analysis of past data shows that the number of doughnuts sold per day is better described by a normal distribution, with a mean 23 dozens and standard deviation 10 dozens. Now, how many doughnuts should Joe stock each day? The expected demand was the same in parts (a) and (b), but the optimal order quantities should have been different. What accounted for this different. What accounted for this difference? Solution.