Exhibit 12.1 The Following Questions Use the Information Below

question 35

Multiple Choice

Exhibit 12.1
The following questions use the information below.
The owner of Fix-a-dent Auto Repair wants to study the growth of his business using simulation. He is interested in simulating the number of damaged cars and the amount of damage to the cars each month. He currently repairs 100 cars per month and feels this can vary uniformly between a decrease of as much as 3% and an increase of up to 5% (average change of 1%) over the previous months. The dollar value of the damage to the cars is a normally distributed random variable with a mean of $3,000 and a standard deviation of $500. The average repair bill has been increasing steadily over the years and the owner expects the mean repair bill will increase by 1% per month. You have created the following spreadsheet to simulate the problem.
-Using the information in Exhibit 12.1, what formula should go cell G5 to calculate the 80^th percentile of the empirical distribution of income?

• A) =IF(RANK(D21) = 80, 1, 0)
• B) None, use Excel Histogram on cell D21.
• C) =IF(COUNTIF(D8:D19 > D21) ≥ 8, 1, 0)
• D) =PsiPercentile(B21, .8).

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Definitions:

Reality Monitoring

The psychological process that distinguishes between internally generated and externally derived perceptions.

Retrograde Amnesia

A type of amnesia where an individual loses memories for events that occurred prior to the cause of the amnesia.

Source-monitoring Error

A source-monitoring error is a type of memory error where an individual is mistaken about the source or origin of a specific memory, often leading to false memories.

Reality-monitoring Error

A cognitive mistake wherein one has trouble distinguishing between actual experiences and imagined or fantasized events.