A grocery store manager wants to analyze customer spending data by product categories: fresh baked goods, meat
Question:
A grocery store manager wants to analyze customer spending data by product categories: fresh baked goods, meat and dairy, produce, and frozen food. For each shopping trip, about 30% of shoppers purchase baked good items, and the spending in this category tends to follow a uniform distribution between $3 and $19. For the meat and dairy products, 70% of shoppers make regular purchases from this category, and their spending is normally distributed with a mean of $21 and standard deviation of $5.27. Eighty percent of the shoppers spend an average of $15 on produce, and their spending follows a normal distribution with a standard deviation of $2.31. Sixty-five percent of shoppers purchase at least one item from the frozen food aisles; the spending amount in this category follows a uniform distribution between $7.25 and $28.50. On average, approximately 220 customers make a trip to the grocery store each day. Develop a Monte Carlo simulation and risk analysis model to analyze the customer spending and the fluctuation in daily revenue.
Step by Step Answer:
Business Analytics
ISBN: 9781265897109
2nd Edition
Authors: Sanjiv Jaggia, Alison Kelly, Kevin Lertwachara, Leida Chen