Problem 1 (20 points) The owner of Luxury Cars 51 collected the following statistics: Potential Rentals Daily Probability 0 0.10 1 0.17 2 0.20 3 0.28 4 0.25 Rental Duration Probability 1 day 0.48 2...

Problem 1 (20 points)

The owner of Luxury Cars 51 collected the following statistics:

Potential Rentals Daily	Probability
0	0.10
1	0.17
2	0.20
3	0.28
4	0.25

Rental Duration	Probability
1 day	0.48
2 days	0.30
3 days	0.15
4 days	0.07

The gross profit is $39 per car per day rented. When there is demand for a car but none is available, there is an opportunity loss of $82. Each day a car is unused costs you $16 per car. Luxury Cars 51 initially has four cars.

Conduct a 10-day simulation of this business and determine the profit (repeat the 10-day simulation 100 times)

If your firm can obtain another car for $200 for 10 days, should you take the extra car?

Homework · Please follow the instructions (upload 2 files) (don’t upload compressed zip files) · Please provide your answers as a pdf file (screenshots - one file) · Upload an excel file with your simulations (create a tab for each problem) (one file) Problem 1 (20 points) The owner of Luxury Cars 51 collected the following statistics: Potential Rentals Daily Probability 0 0.10 1 0.17 2 0.20 3 0.28 4 0.25 Rental Duration Probability 1 day 0.48 2 days 0.30 3 days 0.15 4 days 0.07 The gross profit is $39 per car per day rented. When there is demand for a car but none is available, there is an opportunity loss of $82. Each day a car is unused costs you $16 per car. Luxury Cars 51 initially has four cars. Conduct a 10-day simulation of this business and determine the profit (repeat the 10-day simulation 100 times) If your firm can obtain another car for $200 for 10 days, should you take the extra car?