Use the data set shown below to answer the following question(s). For this Newsvendor model,fit a distribution with Crystal Ball and use the Decision Table tool for analysis.Use 5,000 trials for the simulation.
-For the given Newsvendor model,which of the following is defined as the decision variable?
A)Demand with lower bound 50 and upper bound 60
B)Purchase quantity with lower bound 50 and upper bound 60
C)Surplus quantity with lower bound 50 and upper bound 60
D)Profit with lower bound 50 and upper bound 60

Question

Use the data set shown below to answer the following question(s).   For this Newsvendor model,fit a distribution with Crystal Ball and use the Decision Table tool for analysis.Use 5,000 trials for the simulation.
-For the given Newsvendor model,which of the following is defined as the decision variable?
A)Demand with lower bound 50 and upper bound 60 
B)Purchase quantity with lower bound 50 and upper bound 60 
C)Surplus quantity with lower bound 50 and upper bound 60 
D)Profit with lower bound 50 and upper bound 60

Quizplus · Accepted Answer

The decision variable in the Newsvendor model is the quantity to be purchased, which is represented by the purchase quantity with lower bound 50 and upper bound 60. The goal is to determine the optimal purchase quantity that maximizes expected profit, given uncertain demand and a fixed selling price. Surplus quantity and profit are not decision variables in this model. Demand is uncertain and cannot be controlled, so it is not a decision variable either.

Use the Data Set Shown Below to Answer the Following