ISM INTE Question Answer
A disaster response manager plans to deliver pallets of bottled water to volunteers at a disaster site. The water comes from a nearby bottling company at a preferential cost of $50 per pallet. The number of pallets of bottled water needed is impossible to know in advance due to numerous variables, although experience indicates that the likelihood of consumption is equal: a 25% chance each for 1, 2, 3 or 4 pallets of bottled water. If a full pallet is returned, a restocking fee of 520 is charged. If not enough water is brought in, the cost of purchasing a pallet of water on location is expected to be $200.
How many pallets should the manager deliver?
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