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Message
re: Solve this problem: how much did the owner lose?
Posted on 8/20/18 at 8:35 am to terd ferguson
Posted on 8/20/18 at 8:35 am to terd ferguson
quote:
He can replace the goods with new supply and still make the profit. He's only out his original cost.
1. Lost 100
2. Gained 100
3. Lost 50 in costs (20 in opportunity costs)
4. Lost 30
Total = 50 + 20 + 30 = 100 if stopped here
5. Loses 50 more to regain opportunity costs
Total = 50 + 50 + 30 + (20 lost previously - 20 gained back)
Total = 130 after rebuying at cost to make opportunity cost
1
Posted on 8/20/18 at 8:38 am to theunknownknight
quote:
Total = 130 after rebuying at cost to make opportunity cost
Sells rebought goods for $70
-$130 + $70 = $60 lost
Posted on 8/20/18 at 8:43 am to terd ferguson
Using your logic, the owner made a profit
Loses 80 dollars in value at first.
Why buy just 50 dollars of goods to replace? Why not 350 dollars?
Then it’s 490 revenue (from 350 restock) - (80 initial cost + 350 new costs) = 60 dollars profit
I mean, if restocking is part of the solution why stop at 1?
Loses 80 dollars in value at first.
Why buy just 50 dollars of goods to replace? Why not 350 dollars?
Then it’s 490 revenue (from 350 restock) - (80 initial cost + 350 new costs) = 60 dollars profit
I mean, if restocking is part of the solution why stop at 1?
This post was edited on 8/20/18 at 8:49 am
Posted on 8/20/18 at 8:46 am to theunknownknight
quote:
Why buy just 50 dollars of goods to replace? Why not 350 dollars?
Bc we're talking about his cost to replace the stolen goods... which were valued at $50 (in our simulation).
Posted on 8/20/18 at 8:49 am to terd ferguson
Yeah but that’s a separate transaction after the final question of the riddle. The riddle tells us nothing of the owners cash on hand. He may have 0 dollars to spend. So why stop at 50?
This post was edited on 8/20/18 at 8:50 am
Posted on 8/20/18 at 8:53 am to theunknownknight
It doesn't matter how many times you reword it or how much the owner buys after the fact. He will still always be out the $30 cash and whatever he paid for the $70 in goods (his cost).
Cash - $30
Value - his cost for the $70 worth of goods that will have to be replaced
quote:
The orginal riddle asks how much CASH does the owner lose making it a trick question imo. The debate centers on how much cash versus how much VALUE the owner lost.
What says the OT?
Cash - $30
Value - his cost for the $70 worth of goods that will have to be replaced
This post was edited on 8/20/18 at 8:54 am
Posted on 8/20/18 at 8:54 am to terd ferguson
quote:
It doesn't matter how many times you reword it or how much the owner buys after the fact. He will still always be out the $30 cash and whatever he paid for the $70 in goods (his cost).
He will also always be out the profit he would have made selling those items. He will not get the opportunity to sell those particular items again, no matter how many times he replaces them. How are you not getting that?
Posted on 8/20/18 at 8:54 am to terd ferguson
And what if he paid $70 dollars for the goods stolen and was breaking even on those goods so he could make a higher profit margin on goods with higher velocity?
This post was edited on 8/20/18 at 8:55 am
Posted on 8/20/18 at 8:55 am to LNCHBOX
quote:
He will also always be out the profit he would have made selling those items. He will not get the opportunity to sell those particular items again, no matter how many times he replaces them. How are you not getting that?
There is no guarantee of profit or that the inventory will be sold.
Posted on 8/20/18 at 8:56 am to Mingo Was His NameO
quote:
There is no guarantee of profit or that the inventory will be sold.
Speaking of overthinking...
Posted on 8/20/18 at 8:57 am to LNCHBOX
quote:
He will also always be out the profit he would have made selling those items.
If he normally buys 5 of whatever he lost then he buys 6 the next order... now he replaced the item lost and also replaces his opportunity for a profit.
The only way I see him losing out completely on a profit would be if the item was something rare that he couldn't replace.
Posted on 8/20/18 at 8:58 am to theunknownknight
quote:
And what if he paid $70 dollars for the goods stolen and was breaking even on those goods so he could make a higher profit margin on goods with higher velocity?
If he paid $70 for the $70 worth of goods then he lost $70.
$30 cash + $70 goods = $100 loss
Posted on 8/20/18 at 8:58 am to Mingo Was His NameO
In that case the owner only lost
30 - 20 profit (using the cost of 50) = 10 dollars
because he already lost money initially stocking.
None of which is stated in the riddle
30 - 20 profit (using the cost of 50) = 10 dollars
because he already lost money initially stocking.
None of which is stated in the riddle
Posted on 8/20/18 at 8:59 am to terd ferguson
quote:
If he normally buys 5 of whatever he lost then he buys 6 the next order... now he replaced the item lost and also replaces his opportunity for a profit.
And he had to buy an additional item to get that opportunity back. Why do you keep ignoring half of the variables?
quote:
The only way I see him losing out completely on a profit would be if the item was something rare that he couldn't replace.
He can't replace that specific item. It's gone, never to be seen from again. Serialize the items and it should become more clear to you.
Posted on 8/20/18 at 9:00 am to terd ferguson
quote:
If he paid $70 for the $70 worth of goods then he lost $70.
$30 cash + $70 goods = $100 loss
Ok now that you admitted that, where in the riddle does it say the goods cost less that $70 dollars?
If you can assume the goods cost less, I can just as easily assume the goods cost MORE and he was selling at a loss or to break even so as to profit somewhere else
Posted on 8/20/18 at 9:00 am to terd ferguson
quote:
Let's say the $70 worth of merchandise cost the owner $50 originally. That means he lost $50 worth of goods.
If someone stole your 2008 F250, would you say you lost what it's worth ($10,000) or what you paid for it ($50,000)?
ETA - I see this explanation was already made.
This post was edited on 8/20/18 at 9:05 am
Posted on 8/20/18 at 9:01 am to theunknownknight
Loses $100 dollars.
Thief takes $100 - owner is down $100
Thief gives owner $100 - owner is now even
Owner gives thief $70 in goods - owner is down $70
Owner gives thief $30 in change - owner is down $100
Thief takes $100 - owner is down $100
Thief gives owner $100 - owner is now even
Owner gives thief $70 in goods - owner is down $70
Owner gives thief $30 in change - owner is down $100
This post was edited on 8/20/18 at 9:02 am
Posted on 8/20/18 at 9:03 am to LNCHBOX
Let's say I sell widgets. I pay $5 for a widget from my vendor and sell them for $10 to my customers. I have 10 on the shelf and somebody steals 1... I've got 9 left.
A customer wants 20 widgets. I have 9 and I order 11 more to fill the order.
I paid for 10 widgets on my shelf plus an additional 11 to fill the order.
21 widgets = $105
Somebody stole 1 = -$5
I sell 20 to my customer = $200
So instead of making $100 profit I only made $95 bc somebody stole a widget.
I didn't lose out on the potential profit for that widget that was stolen bc I easily replaced it and filled my order. I lost out on the $5 I paid for the widget originally.
A customer wants 20 widgets. I have 9 and I order 11 more to fill the order.
I paid for 10 widgets on my shelf plus an additional 11 to fill the order.
21 widgets = $105
Somebody stole 1 = -$5
I sell 20 to my customer = $200
So instead of making $100 profit I only made $95 bc somebody stole a widget.
I didn't lose out on the potential profit for that widget that was stolen bc I easily replaced it and filled my order. I lost out on the $5 I paid for the widget originally.
Posted on 8/20/18 at 9:04 am to terd ferguson
quote:
Let's say I sell widgets. I pay $5 for a widget from my vendor and sell them for $10 to my customers. I have 10 on the shelf and somebody steals 1... I've got 9 left.
A customer wants 20 widgets. I have 9 and I order 11 more to fill the order.
I paid for 10 widgets on my shelf plus an additional 11 to fill the order.
21 widgets = $105
Somebody stole 1 = -$5
I sell 20 to my customer = $200
So instead of making $100 profit I only made $95 bc somebody stole a widget.
I didn't lose out on the potential profit for that widget that was stolen bc I easily replaced it and filled my order. I lost out on the $5 I paid for the widget originally.
You're still ignoring the lost profit on the stolen widget and having to buy an extra one to gain it back. I assume at this point you're just trolling.
Posted on 8/20/18 at 9:06 am to slackster
quote:
If someone stole your 2008 F250, would you say you lost what it's worth ($10,000) or what you paid for it ($50,000)?
Not the same scenario... unless your supplier sells you 2008 F250's all day long for the same price.
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