Discount Outlet is planning a promotional campaign on a discontinued 50" LED TV. At a

price of $575 per TV, the total demand for this product is expected to have the following

distribution:

Probability 0.10 0.15 0.25 0.40 0.075 0.025

Demand 15 25 35 60 65 75

Discount Outlet can order up to 75 of these TVs from a surplus dealer at a cost of $325 each. This dealer will buy back any unsold TVs at the end of the promotion for $250 each. Use a Monte Carlo simulation to determine how Discount Outlet can maximize the expected profit from this promotion. Consider the following order sizes: 40, 50, 60 and 70.

a. What order size should Discount Outlet place with the surplus dealer?

b. What is the profit Discount Outlet can expect to make from this promotion?

i. Less than $7,500

ii. More than $7,500 but less than $8,500

iii. More than $8,500 but less than $9,500

iv. Between $9,500 and $10,500