Exhibit 12.5 The Following Questions Use the Information Below

question 74

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.
-Sal, from Exhibit 12.5, has produced the following spreadsheet to compute confidence intervals on his income. What formula should go in cell B12 to compute the upper limit on a 95% confidence interval for the population proportion below 90%? Instructions: Answer the following questions using the Analytic Solver Platform Excel add-in.

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Definitions:

Depreciation Expense

The systematic allocation of the cost of a tangible asset over its useful life.

Operating Expenses

Costs associated with the day-to-day operations of a business, excluding the cost of goods sold.

Annual Rate Of Return

The percentage of profit or loss on an investment over a one-year period.

Accumulated Depreciation

The total amount of a tangible fixed asset's cost that has been charged to depreciation expense since the asset was acquired.