Question
In: Statistics and Probability
Galaxy Co. distributes wireless routers to Internet service providers. Galaxy procures each router for $75 from...
Galaxy Co. distributes wireless routers to Internet service providers. Galaxy procures each router for $75 from its supplier and sells each router for $125. Monthly demand for the router is a normal random variable with a mean of 100 units and a standard deviation of 20 units. At the beginning of each month, Galaxy orders enough routers from its supplier to bring the inventory level up to 100 routers. If the monthly demand is less than 100, Galaxy pays $15 per router that remains in inventory at the end of the month. If the monthly demand exceeds 100, Galaxy sells only the 100 routers in stock. Galaxy assigns a shortage cost of $30 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.
a)What is the proportion of months in which demand is completely satisfied? Round your answer to the nearest whole number.
b) Use the simulation model to compare the profitability of monthly replenishment levels of 100, 120, and 140 routers. Which monthly replenishment level maximizes profitability?
c) Use the corresponding 95% confidence intervals on the average profit to make your comparison. Round your answers to the nearest whole number.
Solutions
orchestra answered 2 years agoRelated Solutions
Galaxy Co. distributes wireless routers to Internet service providers. Galaxy procures each router for $75 from...
Galaxy Co. distributes wireless routers to Internet service
providers. Galaxy procures each router for $75 from its supplier
and sells each router for $125. Monthly demand for the router is a
normal random variable with a mean of 100 units and a standard
deviation of 20 units. At the beginning of each month, Galaxy
orders enough routers from its supplier to bring the inventory
level up to 100 routers. If the monthly demand is less than 100,
Galaxy pays $15...
An Internet packet travels from its source to router 1, from router 1 to router 2,...
An Internet packet travels from its source to router 1, from
router 1 to router 2, and from router2 to its destination. Once the
packet arrives to a router, the router can drop the packet. Packets
only get dropped during transmission at a router. If routers drop
packets independently with probability 0.5%, what is the
probability that a packet is successfully transmitted from its
source to its destination?
Rotelco is one of the largest digital wireless service providers in the United States. In a...
Rotelco is one of the largest digital wireless service providers
in the United States. In a recent year, it had approximately 100
direct subscribers (accounts) that generated revenue of $28,400.
Costs and expenses for the year were as follows: Cost of revenue
$13,900 Selling, general, and administrative expenses 9,400
Depreciation 3,100 Assume that 75% of the cost of revenue and 20%
of the selling, general, and administrative expenses are variable
to the number of direct subscribers (accounts). a. What is...
Rotelco is one of the largest digital wireless service providers in the United States. In a...
Rotelco is one of the largest digital wireless service providers
in the United States. In a recent year, it had approximately 100
million direct subscribers (accounts) that generated revenue of
$31,100 million. Costs and expenses for the year were as
follows:
Cost of revenue
$14,600
Selling, general, and administrative expenses
10,000
Depreciation
3,400
Assume that 70% of the cost of revenue and 30% of the selling,
general, and administrative expenses are variable to the number of
direct subscribers (accounts).
a....
Rotelco is one of the largest digital wireless service providers in the United States. In a...
Rotelco is one of the largest digital wireless service providers
in the United States. In a recent year, it had approximately 100
million direct subscribers (accounts) that generated revenue of
$30,200 million. Costs and expenses for the year were as
follows:
Cost of revenue
$14,500
Selling, general, and administrative expenses
8,800
Depreciation
3,300
Assume that 70% of the cost of revenue and 30% of the selling,
general, and administrative expenses are variable to the number of
direct subscribers (accounts).
a....
Rotelco is one of the largest digital wireless service providers in the United States. In a...
Rotelco is one of the largest digital wireless service providers
in the United States. In a recent year, it had approximately 100
million direct subscribers (accounts) that generated revenue of
$54,300 million. Costs and expenses for the year were as
follows:
Cost of revenue
$22,300
Selling, general, and administrative expenses
17,900
Depreciation
6,000
Assume that 70% of the cost of revenue and 30% of the selling,
general, and administrative expenses are variable to the number of
direct subscribers (accounts).
a....
"The ability of internet service providers to charge termination fees to content providers for delivering their...
"The ability of internet service providers to charge termination
fees to content providers for delivering their content raises an
important question for policy: does a positive termination fee lead
to an equal reduction in prices to users?” Can economic analysis
help answer this question? Explain
Break-even analysis for a service company Rotelco is one of the largest digital wireless service providers...
Break-even analysis for a service company Rotelco is one of the
largest digital wireless service providers in the United States. In
a recent year, it had approximately 100 direct subscribers
(accounts) that generated revenue of $36,300. Costs and expenses
for the year were as follows: Cost of revenue $16,300 Selling,
general, and administrative expenses 11,600 Depreciation 4,000
Assume that 60% of the cost of revenue and 30% of the selling,
general, and administrative expenses are variable to the number of...
Sprint Nextel is one of the largest digital wireless service providers in the United States. In...
Sprint Nextel is one of the largest digital wireless service
providers in the United States. In a recent year, it had
approximately 32.5 million direct subscribers (accounts) that
generated revenue of $35,345 million. Costs and expenses for the
year were as follows (in millions): Cost of revenue $20,841
Selling, general, and administrative expenses 9,765 Depreciation
2,239 Assume that 70% of the cost of revenue and 30% of the
selling, general, and administrative expenses are variable to the
number of direct...
Managers at a local phone service wireless retail center have a goal that 75% of the...
Managers at a local phone service wireless retail center have a
goal that 75% of the center's customers will have to wait less
than five minutes for service. The data below shows the wait times
of a random sample of 25 customers in minutes. Does this sample
provide evidence that management's goal is being achieved?
"The random sample of wait times."
41
5.7
2.3
10.3
3.4
3.8
0.4
7.4
4.4
5.1
4.7
2.6
3.7
9.6
6.6
5.4
4.7
0.3
2.9...
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