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Business Data Model Essay

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Business Decision Models ____________________________________________________________ ________________________ Question 1 (10 marks) Sandra Enright of Techtronics Inc., an electronics supply firm, has been examining the times required for stock pickers to fill orders requested from inventory. She has determined that individual order-filling times approximately follow a normal distribution with a mean value of 3.2 minutes and standard deviation of 68 seconds. a) What is the probability that a randomly selected order will require more than three minutes? b) What is the probability that a randomly selected order will require less than two minutes? c) What is the …show more content…

In answering the following questions, you may assume that these parameters are known exactly. a) What is the probability that a randomly selected order will require more than six days? b) What is the probability that a randomly selected order will require between three and six days? c) The company is considering a $50 cash-back guarantee on any orders that have delivery times longer than a specified maximum but are not sure what maximum time to guarantee. They would be willing to pay out the guarantee on no more than 3% of their deliveries. What time limit in whole days should they set for their guarantee? d) What is the probability that the mean time for a sample of fifteen randomly selected orders will be more than six days? Assignment One - Solutions Question 1 a) 1 – NORMDIST(3,3.2,1.133,1) = 0.57 b) NORMDIST(2,3.2,1.133,1) = 0.1448 c) NORMDIST(3,3.2,1.133,1) – NORMDIST(2,3.2,1.133,1) = 0.2851 d) =NORMINV(0.95,3.2,1.133) = 5.064 minutes Question 2 Part a Part b Daily profit is quite good at about $329, but note that the standard deviation is large by comparison at about $794. Gerald can thus expect to experience a lot of volatility in his profits. Question

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