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following table. Procurement Cost($) 10 11 12 on is Probability 0.25 0.45 0.30 Labor Cost ($) 20 22 24 25 Probability 0.10 0.25 0.35 0.30 (a) Compute profit (in $) per unit for the base-case scenario. $ x /unit (b) Compute profit (in $) per unit for the worst-case scenario. $4 /unit (c) Compute profit (in $) per unit for the best-case scenario. $4 /unit Transportation Cost ($) 3 5 Probability 0.75 0.25 Oduct. The samy P Will De 30 pr cost, the

following table. Procurement Cost($) 10 11 12 on is Probability 0.25 0.45 0.30 Labor Cost ($) 20 22 24 25 Probability 0.10 0.25 0.35 0.30 (a) Compute profit (in $) per unit for the base-case scenario. $ x /unit (b) Compute profit (in $) per unit for the worst-case scenario. $4 /unit (c) Compute profit (in $) per unit for the best-case scenario. $4 /unit Transportation Cost ($) 3 5 Probability 0.75 0.25 Oduct. The samy P Will De 30 pr cost, the

A First Course in Probability (10th Edition)
A First Course in Probability (10th Edition)
10th Edition
ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
Section: Chapter Questions
Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...
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Brinkley Parameters Selling Price Procurement Cost Labor Cost Transportation Cost Procurement Cost Lower End of Interval Labor Cost Lower End of Interval Transportation Cost Lower End of Interval Model Profit Per Unit Simulation Trial 1 2 3 Upper End of Interval Upper End of Interval Upper End of Interval Procurement Cost Cost Cost Cost $10.00 $11.00 $12.00 $20.00 $22.00 $24.00 $25.00 $3.00 $5.00 Labor Cost Probability Probability Probability 0.25 0.45 0.3 0.1 0.25 0.35 0.3 0.75 0.25 Transportation Cost Profit Per Unit Summary Statistics Mean Profit Per Unit P(Profit < $5) ▼ #DIV/0! #DIV/0!
Transcribed Image Text:Brinkley Parameters Selling Price Procurement Cost Labor Cost Transportation Cost Procurement Cost Lower End of Interval Labor Cost Lower End of Interval Transportation Cost Lower End of Interval Model Profit Per Unit Simulation Trial 1 2 3 Upper End of Interval Upper End of Interval Upper End of Interval Procurement Cost Cost Cost Cost $10.00 $11.00 $12.00 $20.00 $22.00 $24.00 $25.00 $3.00 $5.00 Labor Cost Probability Probability Probability 0.25 0.45 0.3 0.1 0.25 0.35 0.3 0.75 0.25 Transportation Cost Profit Per Unit Summary Statistics Mean Profit Per Unit P(Profit < $5) ▼ #DIV/0! #DIV/0!
The management of Brinkley Corporation is interested in using simulation to estimate the profit (in $) per unit for a new product. The selling price for the product will be $46 per unit. Probability distributions for the purchase cost, the labor cost, and the transportation cost are estimated in the following table. Procurement Cost($) 10 11 12 Probability 0.25 4 0.45 0.30 Labor Cost ($) 20 22 24 25 Probability 0.10 0.25 0.35 0.30 (a) Compute profit (in $) per unit for the base-case scenario. $ x /unit (b) Compute profit (in $) per unit for the worst-case scenario. $4 /unit (c) Compute profit (in $) per unit for the best-case scenario. /unit Transportation Probability Cost ($) 3 5 0.75 0.25 (d) Construct a simulation model to estimate the mean profit (in $) per unit. (Use at least 1,000 trials. Round your answer to two decimal places.) (e) Why is the simulation approach to risk analysis preferable to generating a variety of what-if scenarios? Simulation will provide ---Select--- ✓✓ of the profit per unit values which can then be used to find ---Select--- ✓ of an unacceptably low profit. (f) Management believes the project may not be sustainable if the profit per unit is less than $5. Use simulation to estimate the probability the profit per unit will be less than $5. (Round your answer to three decimal places.)
Transcribed Image Text:The management of Brinkley Corporation is interested in using simulation to estimate the profit (in $) per unit for a new product. The selling price for the product will be $46 per unit. Probability distributions for the purchase cost, the labor cost, and the transportation cost are estimated in the following table. Procurement Cost($) 10 11 12 Probability 0.25 4 0.45 0.30 Labor Cost ($) 20 22 24 25 Probability 0.10 0.25 0.35 0.30 (a) Compute profit (in $) per unit for the base-case scenario. $ x /unit (b) Compute profit (in $) per unit for the worst-case scenario. $4 /unit (c) Compute profit (in $) per unit for the best-case scenario. /unit Transportation Probability Cost ($) 3 5 0.75 0.25 (d) Construct a simulation model to estimate the mean profit (in $) per unit. (Use at least 1,000 trials. Round your answer to two decimal places.) (e) Why is the simulation approach to risk analysis preferable to generating a variety of what-if scenarios? Simulation will provide ---Select--- ✓✓ of the profit per unit values which can then be used to find ---Select--- ✓ of an unacceptably low profit. (f) Management believes the project may not be sustainable if the profit per unit is less than $5. Use simulation to estimate the probability the profit per unit will be less than $5. (Round your answer to three decimal places.)
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The management of Brinkley Corporation is interested in using simulation to estimate the profit (in $) per unit for a new product. The selling price for the product will be $46 per unit. Probability distributions for the purchase cost, the labor cost, and the transportation cost are estimated in the following table. Procurement Cost($) 10 11 12 7 Probability 0.25 0.45 X 0.30 Labor Cost ($) 20 X 22 24 25 Probability 0.10 0.25 (a) Compute profit (in $) per unit for the base-case scenario. $18 /unit 0.35 (b) Compute profit (in $) per unit for the worst-case scenario. $ 2 4 /unit 0.30 (c) Compute profit (in $) per unit for the best-case scenario. $313 ✓ /unit Transportation Cost ($) 3 5 Probability (d) Construct a simulation model to estimate the mean profit (in $) per unit. (Use at least 1,000 trials. Round your answer to two decimal places.) $ 0.75 0.25 (e) Why is the simulation approach to risk analysis preferable to generating a variety of what-if scenarios? Simulation will provide 5 a distribution of the profit per unit values which can then be used to find the probability (f) Management believes the project may not be sustainable if the profit per unit is less than $5. Use simulation to estimate the probability the profit per unit will be less than $5. (Round your answer to three decimal places.) of an unacceptably low profit.
Transcribed Image Text:The management of Brinkley Corporation is interested in using simulation to estimate the profit (in $) per unit for a new product. The selling price for the product will be $46 per unit. Probability distributions for the purchase cost, the labor cost, and the transportation cost are estimated in the following table. Procurement Cost($) 10 11 12 7 Probability 0.25 0.45 X 0.30 Labor Cost ($) 20 X 22 24 25 Probability 0.10 0.25 (a) Compute profit (in $) per unit for the base-case scenario. $18 /unit 0.35 (b) Compute profit (in $) per unit for the worst-case scenario. $ 2 4 /unit 0.30 (c) Compute profit (in $) per unit for the best-case scenario. $313 ✓ /unit Transportation Cost ($) 3 5 Probability (d) Construct a simulation model to estimate the mean profit (in $) per unit. (Use at least 1,000 trials. Round your answer to two decimal places.) $ 0.75 0.25 (e) Why is the simulation approach to risk analysis preferable to generating a variety of what-if scenarios? Simulation will provide 5 a distribution of the profit per unit values which can then be used to find the probability (f) Management believes the project may not be sustainable if the profit per unit is less than $5. Use simulation to estimate the probability the profit per unit will be less than $5. (Round your answer to three decimal places.) of an unacceptably low profit.
Brinkley Parameters Selling Price Procurement Cost Labor Cost Transportation Cost Procurement Cost Lower End of Interval Labor Cost Lower End of Interval Transportation Cost Lower End of Interval Model Profit Per Unit Simulation Trial 1 2 3 4 Upper End of Interval Upper End of Interval Upper End of Interval Procurement Cost Cost Cost Cost $10.00 $11.00 $12.00 $20.00 $22.00 $24.00 $25.00 $3.00 $5.00 Labor Cost Probability Probability Probability 0.25 0.45 0.3 0.1 0.25 0.35 0.3 0.75 0.25 Transportation Cost Profit Per Unit Summary Statistics Mean Profit Per Unit P(Profit < $5) #DIV/0! #DIV/0!
Transcribed Image Text:Brinkley Parameters Selling Price Procurement Cost Labor Cost Transportation Cost Procurement Cost Lower End of Interval Labor Cost Lower End of Interval Transportation Cost Lower End of Interval Model Profit Per Unit Simulation Trial 1 2 3 4 Upper End of Interval Upper End of Interval Upper End of Interval Procurement Cost Cost Cost Cost $10.00 $11.00 $12.00 $20.00 $22.00 $24.00 $25.00 $3.00 $5.00 Labor Cost Probability Probability Probability 0.25 0.45 0.3 0.1 0.25 0.35 0.3 0.75 0.25 Transportation Cost Profit Per Unit Summary Statistics Mean Profit Per Unit P(Profit < $5) #DIV/0! #DIV/0!
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