ASSIGNMENT

JET Copies Case Problem

JET Copies Case Problem

Introduction

The purpose of the JET Copies Case Problem was to develop a simulation that would help identify the number of times that a copier machine would break down over a year's time, the average repair time days, and lastly the estimated loss of revenue that occurred when the machine broke down each time. The owners of the company needed this information to make a decision on whether or not to purchase a backup copier.

I decided to start with the table on page 679, which identified the probability of the days that it took the copier to get fixed each time that it broke down. I calculated the cumulative probability before beginning my simulation. I figured that in a year's time with a max of six weeks between breakdowns according to the information given, that the copier would break down approximately 15 times. In Excel, I created fifteen random numbers (RN1) based upon my cumulative probability and probability distribution given. After which, I determined an average number of repair days for each break down which calculated to be about 2 days.

The second step taken to begin this simulation was to determine the frequency of how often the copier would break down. The probability given was based upon speaking with staff members from the college of business and notating that the probability of the break downs increased the longer the copier went without breaking down.

My next step was to figure out the revenue that the business was receiving daily. The business owners decided that they would sell between 2,000 and 8,000 copies per day. Each copy would be ten cents. I was able to create a third table using this information. I took each increment of 1,000 copies between the minimum and maximum given and multiplied by ten cents. I was able to again compute the cumulative probability values. For my third set of random numbers (RN3), I had to do RANDBETWEEN so that the values would be between the minimum and maximum values provided. After these random numbers were given, by multiplying each by ten cents, the daily average revenue was calculated. After completing all these steps I was able to use the daily revenue amounts as well as the number of days it took for each repair to decide the lost revenue for each breakdown. Afterwards, I found the total sum ...