Stochastic Model

Suppose you are going on a weekend trip to a city that is d miles away. Develop a model that determines your round-trip gasoline costs. What assumptions or approximations are necessary to treat this model as a deterministic model? Are these assumptions or approxi- mations acceptable to you?


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Suppose the firm in this example considers a second product that has a unit profit of $5 and requires 2 hours for each unit produced. Assume total production capacity remains 40 units. Use y as the number of units of product 2 produced. a. Show the mathematical model when both products are considered simultaneously. b. Identify the controllable and uncontrollable inputs for this model. c. Draw the flowchart of the input–output process for this model. d. What are the optimal solution values of x and y? e. Is this model a deterministic or a stochastic model? Explain.