please write in Excel

Assignment #4 In class Team Assignment Expectations: 1. In the submitted technical report also demonstrate the followings: a) Make a list of three useful heuristics found in this chapter. b) Mention at least three lessons you have learned from this chapter. c) Define the following terminologies: Model Trade Offs Accuracy Variables and parameters Robustness Critique of Model Sensitivity 2) Submit a technical report and Excel sheet to describe the overall modeling solution process to solve the attached External Problem External Problem You are an investor who has two businesses, the first is purchasing used cars , modifying and selling them. The second is dealing in new cars. The first business has a long term profit cycle, however it has a profit margin ranges from 40 % to 75% of the purchasing price. The second has a short term profit cycle and has a profit margin ranges from 15% to 30 % of the purchasing price. Now, you have an extra amount of money, which is enough to be invested in only one of the two businesses. By adding this amount of investment to either of the two businesses, its sales are supposed to be doubled. 1) Establish a predictive model to find out, to which of the two businesses the new investment is supposed to be added. Consider the following notes and directions: a) Sales records during the last three vears give the following monthly basis selling data: Sales of used cars between SR 40,000 and SR 1,00,000. Selling prices of new cars vary between SR 1,000 and SR 7,800. The number of sold cars between 15 and 30. Consider appropriate period for your calculations and remember that ultimately you want to have maximum benefit from your investment. Use random number generator to estimate the model parameters. b) For your establish model, evaluate the Robustness and Sensitivity of the results. II) If the addition of the amount of investment to either of the two businesses will affect their sales in different manners, as following: If it is added to the first business it will increase its sales by 20% If it is added to the second business it will double its sales a) What will be your decision in this case? (i.e. which of the two businesses the new investment is supposed to be added). b) Evaluate the Robustness and Sensitivity of the results for the case discussed above. Assignment #4 In class Team Assignment Expectations: 1. In the submitted technical report also demonstrate the followings: a) Make a list of three useful heuristics found in this chapter. b) Mention at least three lessons you have learned from this chapter. c) Define the following terminologies: Model Trade Offs Accuracy Variables and parameters Robustness Critique of Model Sensitivity 2) Submit a technical report and Excel sheet to describe the overall modeling solution process to solve the attached External Problem External Problem You are an investor who has two businesses, the first is purchasing used cars , modifying and selling them. The second is dealing in new cars. The first business has a long term profit cycle, however it has a profit margin ranges from 40 % to 75% of the purchasing price. The second has a short term profit cycle and has a profit margin ranges from 15% to 30 % of the purchasing price. Now, you have an extra amount of money, which is enough to be invested in only one of the two businesses. By adding this amount of investment to either of the two businesses, its sales are supposed to be doubled. 1) Establish a predictive model to find out, to which of the two businesses the new investment is supposed to be added. Consider the following notes and directions: a) Sales records during the last three vears give the following monthly basis selling data: Sales of used cars between SR 40,000 and SR 1,00,000. Selling prices of new cars vary between SR 1,000 and SR 7,800. The number of sold cars between 15 and 30. Consider appropriate period for your calculations and remember that ultimately you want to have maximum benefit from your investment. Use random number generator to estimate the model parameters. b) For your establish model, evaluate the Robustness and Sensitivity of the results. II) If the addition of the amount of investment to either of the two businesses will affect their sales in different manners, as following: If it is added to the first business it will increase its sales by 20% If it is added to the second business it will double its sales a) What will be your decision in this case? (i.e. which of the two businesses the new investment is supposed to be added). b) Evaluate the Robustness and Sensitivity of the results for the case discussed above