Find the required amount of dollars to carry

Reference no: EM131371118

Pierre operates a currency exchange office at Orly Airport in Paris. His office is open at night when the airport bank is closed, and he makes most of his business on returning U.S. tourists who need to change their remaining euros back to U.S. dollars.

From experience, Pierre knows that the demand for dollars on any given night during high season is approximately normally distributed with mean $25,000 and standard deviation $5,000.

If Pierre carries too much cash in dollars overnight, he pays a penalty: interest on the cash. On the other hand, if he runs short of cash during the night, he needs to send a person downtown to an all-night financial agency to get the required cash.

This, too, is costly to him. Therefore, Pierre would like to carry overnight an amount of money such that the demand on 85% of the nights will not exceed this amount. Can you help Pierre find the required amount of dollars to carry?

Reference no: EM131371118

Questions Cloud

Evaluate criminal justice in selected countries : you will evaluate criminal justice in selected countries. Since mens rea refers to criminal intent, the concept of guilty but insane sounds like an oxymoron to most people. Chapters 1 and 3 in the course text discuss international perspectives on ..

What is the total cost of campaign : A group of students in MSIS 3233 class is working on advertising the bedlam game 2016 (OSU Vs OU). There are three forms of advertisement possible: radio, television ad and newspaper. Each television ad costs $20,000 and reaches to 10,000 viewers (4,..

What should be the balance in account receivable at december : At the end of its first year of operations, December 31, 2010, Darden Inc. reported. What should be the balance in accounts receivable at December 31, 2010, before subtracting the allowance for doubtful accounts?

Find two values x1 and x2 : Let X be a normally distributed random variable with mean 600 and variance 10,000. Find two values x1 and x2 such that P(X > x1) = 0.01 and P(X > x2) = 0.05.

Find the required amount of dollars to carry : Pierre would like to carry overnight an amount of money such that the demand on 85% of the nights will not exceed this amount. Can you help Pierre find the required amount of dollars to carry?

Do you believe this to be a correct statement : the Tamil Diaspora has created a transitional government and it serves as an incubator for radicalization (White, 2015 p.215).In your view, what does he mean? Do you believe this to be a correct statement?

Regional and international referral service : Southeast Medical Center was established in 1920's, just before the Depression Located in the Southeast, a $ million bond financed the 250-bed facility. Major expansion projects in the 1950's increased the hospital to 600 beds. The hospital serves as..

Examine the potential impact of time-driven abc costing : Examine the potential impact of time-driven ABC costing on services provided online with those provided through traditional channels, considering how this knowledge will impact decisions made by management about these services.

Select the supreme court ruling that you believe : Select the Supreme Court ruling (BREED VS JONES 1975) that you believe had the biggest impact on the way law enforcement and courts deal with juvenile offenders.Begin by briefly explaining the premise of the case that led to the ruling, what the S..

User Account

All Pages