n August of the current year, a car dealer is trying to determine how many...
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n 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 dealers next year models has the probability distribution shown in the file S10_12.xlsx. Each car cells for $25,000. If demand for next years 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. For your optimal order quantity, find a 95% confidence interval for the expected profit. Distribution of demand Demand Probability 20 0.30 25 0.15 30 0.15 35 0.20 40 0.20
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