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03000ME372052005
The estimated demand of a machine seller has the following demand pattern.
Each machine cost Rs 6200 and sells Rs 9500. Any machine that left unsold at
the end of the season must be disposed of for Rs 5600 each. How many machines
should be in stock so as to maximise expected profit. The pay-offs under

different combinations

Describe the importance of decision making in business problems.

Illustrate a decision tree with the aid of an example. Describe the procedure of
evaluation using decision tree.

State the assumptions of game theory. How games are classified?

Define the terms saddle point and value of game in game theory.

Solve the game whose pay off matrix is given by

Player A/B

Solve the game by graphical method:

Player B

Player A

A shopkeeper keeps stock of an item. Previous experience shows that the daily

demand pattern for the item with the associated probabilities is given below.

Daily Demand (Nos) | 0 10 20 30 | 40 | 50 |
| Probability 0.08 | 0.12 | 0.15 | 0.30 | 0.20 | 0.15 |

Simulate the demand for next 10 days using the following sequence of random
numbers. Random Numbers: 25, 39, 65, 76, 12, 05, 73, 89, 19, 49. Find the
average demand of item per day.

What are the advantages and disadvantages of simulation models?

Explain various languages used in system simulation?

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