An Auto Parts Store Wants to Simulate Its Inventory System

question 11

Multiple Choice

An auto parts store wants to simulate its inventory system for engine oil. The company has collected data on the shipping time for oil and the daily demand for cases of oil. A case of oil generates a $10 profit. Customers can buy oil at any auto parts store so there are no backorders (the company loses the sale and profit) . The company orders 30 cases whenever the inventory position falls below the reorder point of 15 cases. Orders are placed at the beginning of the day and delivered at the beginning of the day so the oil is available on the arrival day. An average service level of 99% is desired. The following spreadsheets have been developed for this problem. The company has simulated 2 weeks of operation for their inventory system. The current level of on-hand inventory is 25 units and no orders are pending.
-Using the information in Exhibit 12.3, what Risk Solver Platform (RSP) function should be used in cell D8 and copied to cells D9:D21 of the MODEL sheet to compute daily demand?

• A)=PsiDiscrete($E$6:$E$13, $F$6:$F$13)
• B)=PsiHypergeo($E$6:$F138)
• C)=PsiBinomial($E$6, $F$13)
• D)=PsiCustom(Data!$E$6, $F$13)

---

Definitions:

Pubescent Girl

A female who is in the stage of adolescence in which she begins to develop secondary sexual characteristics and undergoes physical and hormonal changes.

Ventral Striatum

A part of the brain that plays a significant role in the reward system and is involved in processing rewards, motivation, and decision making.

Risk Taking

The act of undertaking actions which involve danger or risk in order to achieve a specific outcome, often seen as a necessary component of success and growth.

Purging

A behavior in which individuals attempt to remove unwanted food or substances from their body, often associated with eating disorders.