1. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Supplement S10 Simulation

2. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Monte Carlo Simulation Select numbers randomly from a probability distribution Use these values to observe how a model performs over time Random numbers each have an equal likelihood of being selected at random

3. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Distribution of Demand LAPTOPS DEMANDEDFREQUENCY OFPROBABILITY OF PER WEEK, xDEMANDDEMAND, P(x) 0200.20 1400.40 2200.20 3100.10 4100.10 1001.00 Table S10.1

4. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Roulette Wheel of Demand 90 80 60 200 x = 2 x = 0 x = 4 x = 3 x = 1 Figure S10.1

5. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Generating Demand from Random Numbers DEMAND,RANGES OF RANDOM NUMBERS, xr 00-19 120-59r = 39 260-79 380-89 490-99 Table S10.2

6. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Random Number Table 39657645451990696461 73712370906597601211 72184733845167479719 75122569171795217858 37177988746352063430 Table S10.3

7. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Random Numbers in Excel Exhibit S10.1

8. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Simulation in Excel Exhibit S10.2 Enter this formula in G6 and copy to G7:G20 Enter “=4300*G6” in H6 and copy to H7:H20 Generate random numbers for cells F6:F20 with the formula “=RAND()” in F6 and copying to F7:F20 = AVERAGE (G6:G20)

9. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Simulation in Excel Exhibit S10.3

10. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Simulation in Excel Exhibit S10.4 This formula entered in G7 and copied to G8:G105 =VLOOKUP (F6,LOOKUP,2) in H6 and copied to H7:H105 =G6*50 entered into cell L6 and copied to L7:L105 Shortages computed by entering =MIN(G6-H6,0) in I6 and copying to I7:I105

11. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Simulation in Excel Exhibit S10.5 New formula for two laptops ordered per week

12. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. 15 Weeks of Demand Average demand = 31/15 = 2.07 laptops/week WEEKrDEMAND (x)REVENUE (S) 13914,300 27328,600 37228,600 47528,600 53714,300 60200 787312,900 898417,200 91000 104714,300 1193417,200 122114,300 1395417,200 1497417,200 156928,600  = 31$133,300 Table S10.4

13. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Computing Expected Demand E(x) = (0.20)(0) + (0.40)(1) + (0.20)(2) + (0.10)(3) + (0.10)(4) = 1.5 laptops per week Not particularly close to simulated result of 2.07 laptops Difference is due to small number of periods analyzed

14. To Accompany Russell and Taylor, Operations Management, 4th Edition,  2003 Prentice-Hall, Inc. All rights reserved. Waiting Lines/Service Waiting Lines/Service Inventory Management Inventory Management Production and Manufacturing Systems Production and Manufacturing Systems Capital Investment and Budgeting Capital Investment and Budgeting Logistics Logistics Service Operations Service Operations Environmental and Resource Analysis Environmental and Resource Analysis Areas of Simulation Application