Inventory. A merchant knows that the number of items he sells in a month is distributed according to a Poisson distribution. On average, he sells 48 items per year. If at the beginning of a month he has in stock only two items, what is the probability that he will not be able to meet the customer demand? (Hint: 48 items sold per year means 4 per month, so that v ¼ 4 and l ¼ 4; as in the previous case, denote with X the customer demand and with K the stock, so that we need to find P[Demand X > Stock K ¼ 2].) Solve the following Monte Carlo applications for business decisions. 9. A company shows average sales data for £ 5 M, with standard deviation for £ 1.5 M, variable costs for £ 3 M and standard deviation for £ 0.5M., and operating fixed costs (including depreciations) for £ 1 M. Assuming a normal distribution in the two stochastic variables sales and variable costs, construct a Monte Carlo simulation for the Ebit ¼ svc - fc and build an empirical histogram.