The manager of Pauls fruit and vegetable store is considerin

The manager of Paul\'s fruit and vegetable store is considering the purchase of a new seedless watermelon from a wholesale distributor. Since this seedless watermelon costs $4, will sell for $7, and is highly perishable, he only expects to sell between 6 and 9 of them. what is the opportunity loss for purchasing 9 watermelons when the demand is for seven? 8,4,12,0

Solution

seedless watermelon costs $4

purchasing nine watermelons cost is 9*4=36

but the demand is seven watermelons. the seven watermelons cost is 7*4=28

Thus, the opportunity loss is 36-28=8