Answered: Demand in each period follows the same…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

Demand in each period follows the same normal distribution (i.e., there is one demand distribution that represents demand in any single period). Assuming demand is independent across
periods, which of the following statements about mean demand over five periods is true?
a. It equals the mean of demand over one period.
b. It is greater than the mean of demand over one period but less than five times the mean
of demand over one period.
c. It equals five times the mean of demand over one period.
d. It is even more than five times the mean of demand over one period.

Features Features Normal distribution is characterized by two parameters, mean (µ) and standard deviation (σ). When graphed, the mean represents the center of the bell curve and the graph is perfectly symmetric about the center. The mean, median, and mode are all equal for a normal distribution. The standard deviation measures the data's spread from the center. The higher the standard deviation, the more the data is spread out and the flatter the bell curve looks. Variance is another commonly used measure of the spread of the distribution and is equal to the square of the standard deviation.

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