As the owner of the Catch-of-the-Day Fish Shop, you can purchase fresh fish at $20 per crate each morning from Halifax Fish Market During the day, you sell those crates of fish to local restaurants for $50 each. Coupled with the perishable nature of your product, your integrity as a quality distributor requires you to dispose of some of the unsold crate at the end of the day, whereas some of the leftover fish could still be salvaged at a reduced price. On average, your cost of disposal is $5 per crate, whereas salvaging it would bring in $10 per crate. There is 20% chance that an unsold crate of fish can be salvaged, or, you need to dispose of it. You have a problem, however, because you do not know how many crates your customers will order each day. To that end, you collected a substantial number of days' worth of demand data and figured out that the demand is Normally distributed with a mean of 50, and a standard deviation of 4 crates of fish.
a) Find the optimal stocking quantity.