A grocery store orders a weekly hobby magazine. The demand varies weekly, but the historical records...
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A grocery store orders a weekly hobby magazine. The demand varies weekly, but the historical records of the store indicate that there is a trend according to the following table: MAGAZINE PROBABILITY 20 22222 21 23 24 1/36 4/36 17/36 12/36 2/36 Each magazine costs $ 1.50 and sells for $2.50. Unsold magazines are donated to a retirement home. a) Establish a random number generation strategy to simulate demand Tip: Use two dice to simulate demand and remember that the possible outcomes for the sum of two dice are the following: DICE 2 1 123456 1 234567 7 2345678 2 7 DICE 1 3 456700 8 8 9 456700 5 6769 678099E 10 9 10 11 10 11 12 b) Determine the function for calculating the utility. c) Develop a simulation model that determines the optimal number of journals to order to maximize expected utility. (I did at least 30,000 reps) d) Present your results by means of a graph of Utility vs. Ordered Quantity. A grocery store orders a weekly hobby magazine. The demand varies weekly, but the historical records of the store indicate that there is a trend according to the following table: MAGAZINE PROBABILITY 20 22222 21 23 24 1/36 4/36 17/36 12/36 2/36 Each magazine costs $ 1.50 and sells for $2.50. Unsold magazines are donated to a retirement home. a) Establish a random number generation strategy to simulate demand Tip: Use two dice to simulate demand and remember that the possible outcomes for the sum of two dice are the following: DICE 2 1 123456 1 234567 7 2345678 2 7 DICE 1 3 456700 8 8 9 456700 5 6769 678099E 10 9 10 11 10 11 12 b) Determine the function for calculating the utility. c) Develop a simulation model that determines the optimal number of journals to order to maximize expected utility. (I did at least 30,000 reps) d) Present your results by means of a graph of Utility vs. Ordered Quantity.
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