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Realizing that the continuous normal demand distribution doesn't lend itself well to decision trees that require a discrete set of outcomes, the company decides to
Realizing that the continuous normal demand distribution doesn't lend itself well to decision trees that require a discrete set of outcomes, the company decides to replace the normal demand distribution with a discrete distribution with five "typical" values. Specifically, it decides to use the 10th, 30th, 50th, 70th, and 90th percentiles of the given normal distribution. Why is it reasonable to assume that these five possibilities are equally likely? With this discrete approximation, how should the company proceed
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It is reasonable to assume that the five typical demand values the 10th 30th 50th 70th and 90th percentiles are equally likely because in a normal dis...Get Instant Access to Expert-Tailored Solutions
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