Exhibit 12.5 The Following Questions Use the Information Below

question 47

Short Answer

Exhibit 12.5
The following questions use the information below.
The owner of Sal's Italian Restaurant wants to study the growth of his business using simulation. He is interested in simulating the number of customers and the amount ordered by customers each month. He currently serves 1000 customers per month and feels this can vary uniformly between a decrease of as much as 5% and an increase of up to 9%. The bill for each customer is a normally distributed random variable with a mean of $20 and a standard deviation of $5. The average order has been increasing steadily over the years and the owner expects the mean order will increase by 2% per month. You have created the following spreadsheet to simulate the problem.
-What function should be used for generating random numbers between a and b from a symmetric triangular distribution when the most likely value is (a + b)/2?

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Definitions:

Price Discrimination

The approach of pricing the identical product variably for different consumer segments, according to their readiness to spend.

Monopoly Profits

Extraordinary profits earned by a monopoly due to its unique position of having no competition in providing its goods or services, allowing it to set higher prices.

Single-Price Monopolist

Refers to a monopolist who charges all consumers the same price for its product, rather than price discriminating among different consumer groups.

Price Discrimination

A pricing strategy where identical or substantially similar goods or services are sold at different prices by the same provider in different markets or to different consumers.