Infinity Co. sells virtual reality (VR) goggles, particularly targeting customers who like to play video games. Infinity procures each pair of goggles for $150 from its supplier and sells each pair for $300. Monthly demand for the VR goggles is normally distributed with a mean of 160 units and a standard deviation of 40 units. At the beginning of each month, Infinity orders enough goggles to bring the inventory level up to 140 goggles. If the monthly demand is less than 140, Infinity pays $20 per pair of goggles that remains in inventory. If the monthly demand exceeds 140, Infinity sells only the 140 pairs in stock. Infinity assigns a shortage cost of $40 for each unit of demand that is unsatisfied to represent a loss-of-goodwill among its customers. Management would like to use a simulation model to analyze this situation. (Hint: use 1,000 simulation trials) a. Construct a simulation model to estimate the average monthly profit. b. What is the range (i.e., min and max) of the expected average monthly profit? c. What is the proportion of months in which demand is completely satisfied? Parameters Selling price Acquisition cost Holding cost Shortage cost Replenishment level Demand Model Units sold Excess inventory Unmet demand Revenue Acquisition cost Holding cost Shortage cost Profit Satisfied demand? 1 Simulation trials Profit 2 3 4 $ 5 6 $ $ 300 150 20 40 140 per goggle per goggle per goggle per goggle Satisfied demand? Summary Statistics Min Profit Max Profit Mean Profit St Dev Profit Count #Satisfied Demand Prob (Satisf.Demand)