A Ski Shop $(25$ points$)$

Klaus owns a ski shop in Aspen and is facing a typical decision that he makes annually $$ how

many ski jackets to order in the spring for the following ski season. Each jacket costs $$54$

and is offered for sale during the season for $$145.$ Any unsold jackets at the end of the

season are sold at discount for $$45.$ Suppose that demand is given by the following

distribution:

Demand $65707580859095$

Probability $\mathrm{.}05\mathrm{.}10\mathrm{.}20\mathrm{.}30\mathrm{.}20\mathrm{.}10\mathrm{.}05$

Also suppose that the store owner can order lot sizes of $5$ jackets.

a$)$ Construct a Simulation Modeling Template for estimating the profit when ordering $80$ ski

jackets. Do a manual simulation of the cost for $10$ trials using random numbers:

$0\mathrm{.}9642$

$0\mathrm{.}34413$

$0\mathrm{.}20232$

$0\mathrm{.}94271$

$0\mathrm{.}05192$

$0\mathrm{.}20501$

$0\mathrm{.}17359$

$0\mathrm{.}09059$

$0\mathrm{.}63029$

$0\mathrm{.}72947$

Please specify your Process Generator$($s$).$ Using your results, give an approximation of the Risk

Profile. What is the expected profit over your $10$ trials? Based on the $10$ trials, how likely is it

that the store owner will make at least $$7000?($Handwrite answer. $5$ points$)$

b$)$ Repeat part $($a$)$ for the case when the manager orders $85$ ski jackets.

$($Handwrite answer. $5$ points$)$

c$)$ Translate your Modeling Template in part $($a$)$ to EXCEL and simulate using EXCEL for $1000$

trials. What is the Expected profit? How likely is it that Klaus will make at least $$7000?$

Give an approximation to the Risk Profile of ordering $80$ jackets using the bin range $6000,$

$6100,6200,...,8000.($Submit via Canvas. $5$ points$)$

d$)$ Repeat the steps in part $($c$)$ above for the scenario given in part $($b$).($Submit via Canvas. $5$

points$)$