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Answer question 28) - 30) based on the problem description below. The purchasing manager for a firm is trying to determine what the Inventory level
Answer question 28) - 30) based on the problem description below. The purchasing manager for a firm is trying to determine what the Inventory level (Q) should be for a particular product for a one-month period. She has developed the following table based on the past data, which gives the distribution of monthly demand (X ) and the probabilities: Demand (X) Probability 40 0.10 50 0.30 60 0.30 70 0.20 80 0.10 The unit cost of each product is $5, and the unit selling price is $10. At the end of the month, the unsold inventory must be sold on a secondary market, and the unit selling price (Y) in this secondary market depends on the situation at that time. Based on historical data, the following table is developed for distribution of Y: Unit Selling Price on Probability Secondary Market (Y) $1 04 52 0.5 $3 0.1 Assume that the Demand ) and Secondary Market Unit Selling Price Y are independent.28) (4 points) Use the "Table of Random Numbers" in the Appendix to generate 3 pairs of (X, Y) values. You must use the first row to generate I's and the second row to generate Y"'s, starting from the top of each row. Write down the three pairs of generated values: 29) (6 points) Use Monte Carlo simulation to estimate the profits associated with inventory levels of 50 and 60, respectively, by computing average profit numbers for each order quantity, Use the 3 pairs of (X. Y) values developed in 25) for computations. Round your answer to two decimal places. The average profit for Q = 50 15: The average profit for Q = 60 is: 30) (3 point) Based on your answer in 29), the quantity that should be chosen is
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