Exhibit 12.2 The Following Questions Use the Information Below

question 77

Multiple Choice

Exhibit 12.2
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 the change in number of cars can vary uniformly between a decrease of as much as 3% and an increase of up to 5% (average change of 1%) . 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. A spreadsheet model to simulate the problem has been run 300 times. A part of the simulation statistics output from Risk Solver Platform (RSP) and a spreadsheet for computing confidence intervals follows.
-Using the information in Exhibit 12.2, what is the worst case scenario for the Fix-a-dent company based on this output?

• A) $1,747,464.94
• B) $3,339,249.82
• C) $4,122,024.01
• D) $4,207,301.98

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Definitions:

Air Circulators

Devices used to move air in a room or space effectively, often improving ventilation and comfort.

Selling Price

The amount of money charged to a customer for a product or service.

Dangerous Fumes

Hazardous gases or vapors that can cause harm or discomfort to individuals when inhaled.

Large Rotating Air Circulator

A device, often referred to as a fan, that moves air around a room or space to provide cooling.