Consider the fish problem from Homework 7 with the following changes . a per fis

Question

Consider the fish problem from Homework 7 with the following changes . a per fish, per day holding cost is incurred based upon the end of day inventory; . a lost sales cost is incurred per customer not satisfied; * the owner plans to operate the business for another 75 days (end of season) . fish left in the tank at the end of the time horizon are worth a salvage price/fish; For each of the questions below solve a Markov process to determine net revenue. Assume the nominal parameters of this model are: . The maximum number of fish in the tank is 12. .The selling price to customers is $20/fish. The Fuel Surcharge is $20/fishing day. . The fisherman charges $4/fish. The Holding Cost is $1/fish/day. . The Lost Sales Cost is $25/fish. .The Salvage Price is $12/fish. Using the nominal parameters above, determine the expected reward of the process for each state over periods 0 to 75. 1. 2. Determine the steady state gain. 3. Change the capacity of the tank to 10 and redo questions 1 and 2. Explain the change in steady state gain. 4. Now, reset the capacity back to 12 and change the Holding Cost to SO/fish/day and redo questions 1 and 2. Explain the change in steady state gain.

Explanation / Answer

given :

maximum number of fish in tank is 12 .

selling price of 1 fish is $20

holding cost is $1

lost sales cost is $25 ( so we need to avoid this . we need to sell fresh fish for avoid this )

selvage cost =$12 which means $8 less then the actuall selling price .

1) so best way for this is we need to sell all the fish at the same day .

so total cost of 12 fish is = 12*4 +20 = $68

we multiply by 4 because cost of fisherman per fish .. + 20 because cost of fishermen .

selling price for 12 fish is =12*20 =240

s0 total profit is = $240-$68 = $172

2) so total gain for 1 day is $172

for 75 days is $172 *75 = $12900

3) now we change the capacity to 10

Now total cost is =10*4 + 20 =$60

selling price = 10*20 = $200

profit is = 200-60 =$140

so total steady profit is = 140*75 =$10500

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