Question

Rita is the owner of Rita’s Osteria. She wants to study the growth of her business using simulation. She is interested in simulating the number of customers and the amount ordered by customers each month. She feels that the number of customers is normally distributed, with a mean of 800 and a standard deviation of 45. The bill for each customer is $65 and uniformly distributed, with a maximum increase of 8% and a minimum decrease of 5%. The changes of the bills are incremental, i.e. each change is based off the average bill of the previous month. Formulate a simulation, computing the mean total revenue and the standard deviation in one year.

Answer 1

Hi,

Mean Total Revenue will be $ 641583 for one year.

And standard deviation will be $252.58

Please refer the snapshot for calculations: