Consider the Following Frequency of Demand and Random Numbers Random Numbers: 0

question 80

Multiple Choice

Consider the following frequency of demand and random numbers:
$$\begin{array}{l}\begin{array} { c c } &\text { Relative }\\\text { Demand } & \text { Frequency } \\\hline 0 & 0.15 \\1 & 0.30 \\2 & 0.25 \\3 & 0.15 \\4 & 0.15\end{array}\end{array}$$ Random numbers: 0.13, 0.81, 0.53.
-If the simulation begins with the third random number, the simulated value for demand would be:

• A) 0
• B) 1
• C) 2
• D) 3
• E) 4

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Definitions:

Long Run

A period of time in economics during which all factors of production and costs are variable, allowing for full adjustment to change.

Profit-Maximizing

The approach taken by a corporation to find the pricing and production levels that lead to the greatest earnings.

Loss-Minimizing

A strategy or condition in which a firm seeks to minimize its losses by operating at a production level where marginal cost equals marginal revenue.

Total Revenue

The total amount of money received by a company for goods sold or services provided during a certain period.