The Saki automobile dealer in the MinneapolisSt. Paul area orders the Saki sport compact, which gets 50

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The Saki automobile dealer in the Minneapolis–St. Paul area orders the Saki sport compact, which gets 50 miles per gallon of gasoline, from the manufacturer in Japan. However, the dealer never knows for sure how many months it will take to receive an order once it is placed. It can take 1, 2, or 3 months, with the following probabilities:
Months to Receive an Order ..... Probability
1 .............. .50
2 .............. .30
3 .............. .20
1.00

The demand per month is given by the following distribution:
Demand per Month (cars) ...... Probability
1 ............. .10
2 ............. .30
3 ............. .40
4 ............. .20
1.00
The dealer orders when the number of cars on the lot gets down to a certain level. To determine the appropriate level of cars to use as an indicator of when to order, the dealer needs to know how many cars will be demanded during the time required to receive an order. Simulate the demand for 30 orders and compute the average number of cars demanded during the time required to receive an order. At what level of cars in stock should the dealer place an order?

Dealer
A dealer in the securities market is an individual or firm who stands ready and willing to buy a security for its own account (at its bid price) or sell from its own account (at its ask price). A dealer seeks to profit from the spread between the...
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