Purchase Solution

Simulation of demand

Not what you're looking for?

Ask Custom Question

As the owner of a rent-a-car agency you have determined the following statistics:

Potential Rentals Daily Probability Rental Duration Probability
0 .10 1 day .50
1 .15 2 days .30
2 .20 3 days .15
3 .30 4 days .05
4 .25

The gross profit is $40 per car per day rented. When there is demand for a car when none is available there is a goodwill loss of $80 and the rental is lost. Each day a car is unused costs you $5 per car. Your firm initially has 4 cars.

a. Conduct a 10-day simulation of this business using Row #1 below for demand and Row #2 below for rental length.

Row #1:
.257 .887 .037 .661 .036 .173 .634 .818 .932 .069

Row #2:
.446 .465 .069 .457 .283 .525 .064 .503 .373 .751

b. You find out that your firm can obtain another car for $200 for 10 days. Should you take the extra car?

Please help setting up random number and vlookup as well as a detailed solution to the above questions.

Please see the attached file for a complete description of the problem.

Purchase this Solution

Solution Summary

The solution answers questions based on the simulation of demand for a car rental agency.

Purchase this Solution


Free BrainMass Quizzes
Measures of Central Tendency

Tests knowledge of the three main measures of central tendency, including some simple calculation questions.

Measures of Central Tendency

This quiz evaluates the students understanding of the measures of central tendency seen in statistics. This quiz is specifically designed to incorporate the measures of central tendency as they relate to psychological research.

Terms and Definitions for Statistics

This quiz covers basic terms and definitions of statistics.

Know Your Statistical Concepts

Each question is a choice-summary multiple choice question that presents you with a statistical concept and then 4 numbered statements. You must decide which (if any) of the numbered statements is/are true as they relate to the statistical concept.