onfident that the expected profit for the optimal order quantity is between $ and $

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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In August of the current year, a car dealer is trying to determine how many cars of the next model year to order. Each car ordered in August costs $20,000. The demand for the dealer's next year models has the probability distribution
shown in the file P10_12.xlsx. Each car sells for $25,000. If demand for next year's cars exceeds the number of cars ordered in August, the dealer must reorder at a cost of $22,000 per car. Excess cars can be disposed of at $17,000 per
car. Use simulation to determine how many cars to order in August.
25 and 30 v
For your optimal order quantity, find a 95% confidence interval for the expected profit. If needed, round your answers to whole dollar amounts.
We are 95% confident that the expected profit for the optimal order quantity is between $
W and $
Transcribed Image Text:In August of the current year, a car dealer is trying to determine how many cars of the next model year to order. Each car ordered in August costs $20,000. The demand for the dealer's next year models has the probability distribution shown in the file P10_12.xlsx. Each car sells for $25,000. If demand for next year's cars exceeds the number of cars ordered in August, the dealer must reorder at a cost of $22,000 per car. Excess cars can be disposed of at $17,000 per car. Use simulation to determine how many cars to order in August. 25 and 30 v For your optimal order quantity, find a 95% confidence interval for the expected profit. If needed, round your answers to whole dollar amounts. We are 95% confident that the expected profit for the optimal order quantity is between $ W and $
Demand Probability
20
0.30
25
0.15
30
0.15
35
0.20
40
0.20
Transcribed Image Text:Demand Probability 20 0.30 25 0.15 30 0.15 35 0.20 40 0.20
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