Exhibit 12.1 The Following Questions Use the Information Below

question 31

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 Analytic Solver Platform function should go in cell B8 to compute the number of cars repaired in the first month?

• A) =PsiUniform($C$2*(1-$F$2), $C$2*(1+$H$2))
• B) =PsiUniform($C$2*1-$F$2, $C$2*1+$H$2)
• C) =PsiUniform($C$2-(1-$F$2), $C$2+(1+$H$2))
• D) =PsiUniform($C$2+(1-$F$2), $C$2+(1+$H$2))

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Definitions:

Cash Inflows

The movement of money into a business or account, typically from operating activities, financing, and investing.

Discount Rate

The interest rate used to discount future cash flows to their present values in various financial models.

Net Present Value

A calculation that evaluates an investment's profitability by discounting expected future cash flows to their present value and subtracting the initial investment.

Cash Inflows

Funds received by a business from its operational activities, investments, or financing, contributing to its cash pool.