The Paymor Rental Car Agency rents cars in a small town. It wants to determine how many rental cars it should maintain. Based on market projections and historical data, the manager has determined probability distributions for the number of rentals per day and rental duration (in days only) as shown in the following tables:
Number of Customers/Day Probability
0 .................0.20
1 .................0.20
2 .................0.50
3 .................0.10
Rental Duration (days) Probability
1 ................0.10
2 ................0.30
3 ................0.40
4 .................0.10
5 .................0.10
Design a simulation experiment for the car agency and simulate, using a fleet of four rental cars, for 10 days. Compute the probability that the agency will not have a car available on demand. Should the agency expand its fleet? Explain how a simulation experiment could be designed to determine the optimal fleet size for the Paymor Agency.