CB2203 Data Driven Business Modeling

Homework 4

You may answer on a piece of paper and take a photo of your solution. Alternatively, you
may type your solution. Please save your files as HW4-XXXXXXXX.xlsx/.pdf/.doc as
appropriate, where XXXXXXXX is your student id number.

You run a small charity to provide transportation for the elderly. You have a team of volunteer
drivers, and you reimburse the drivers a small sum of money for each ride depending on the
distance between the pick-up point and the destination. You would like to estimate the daily
reimbursement cost. Based on operations of the past year, you know the following information:

1. The number of people who call for a ride in each day is between 0 and 2. The probability
that there will be X callers, where X = 0,1,2 is:

Number of callers per day Probability

0 0.10
1 0.65
2 0.25

2. Each caller’s will ask for a ride between two locations. You reimburse your drivers (for
gas, tunnel charges, etc) based on the following schedule:
Ride ID Probability Reimbursement
A – Kowloon ó New Territories 0.5 $30
B – Kowloon ó HK Island 0.4 $25
C – HK Island ó New Territories 0.1 $50

In Parts (a)-(c), you will design a SIMULATION BY HAND experiment over 10 days (i.e.
10 trials). The following random numbers from 00-99 have already been generated.
List 1 - Random numbers to determine the number of call requests. Start at the top of
the list. There may be more random numbers than you need.
15
35
64
7
44
31
88
25
78
62
10
30
65
94
4
15
79
73
32
12

List 2 - Random numbers to determine the request type of each caller. Start at the top
of the list. There may be more random numbers than you need.

20
11
54
22
72
82
12
26
6
98
63
59
89
a) Using simulation by hand and the first list of random numbers, run a simulation with 10
trials/days to determine the number of calls received per day. Start from the TOP of
random number List 1.
b) Based on the results of part (a), use the second list of random numbers to simulate the
requests of each caller. In other words, determine the Ride ID of caller X of Day Y. Start
from the TOP of random number List 2.

c) Determine the average daily reimbursement cost.