Homework Help is Here – Start Your Trial Now!
Math
Probability
Questions I. Egress management believes that a normal distribution is a reasonable model for the unknown demand in the coming year.What mean and standard deviation should Egress use for the demand distribution? 2. Use a spreadsheet model to simulate 1000 possible outcomes for demand in the coming year. Based on these scenarios, what is the expected profit if Egress produces Q = 7800 ski jackets? What is the expected profit if Egress produces Q = 12,000 ski jackets? What is the standard deviation of profit in these two cases? 3. Based on the same 1000 scenarios, how many ski jackets should Egress produce to maximize expected profit? Call this quantity Q. 4. Should Q equal mean demand or not? Explain. 5. Create a histogram of profit at the production level Q. Create a histogram of profit when the production level Q equals mean demand. What is the probability of a loss greater than $100,000 in each case?

Questions I. Egress management believes that a normal distribution is a reasonable model for the unknown demand in the coming year.What mean and standard deviation should Egress use for the demand distribution? 2. Use a spreadsheet model to simulate 1000 possible outcomes for demand in the coming year. Based on these scenarios, what is the expected profit if Egress produces Q = 7800 ski jackets? What is the expected profit if Egress produces Q = 12,000 ski jackets? What is the standard deviation of profit in these two cases? 3. Based on the same 1000 scenarios, how many ski jackets should Egress produce to maximize expected profit? Call this quantity Q. 4. Should Q equal mean demand or not? Explain. 5. Create a histogram of profit at the production level Q. Create a histogram of profit when the production level Q equals mean demand. What is the probability of a loss greater than $100,000 in each case?

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...
See similar textbooks
icon
Related questions
icon
Concept explainers
Topic Video
Question

Hello,I want you to solve the 2nd and 3rd items of the problem I shared as a photo.
I want a solution in excel format with the Monte Carlo model.

CASE 15.1 SKI JACKET PRODUCTION gress, Inc., is a small company that designs, -produces, and sells ski jackets and other coats. The creative design team has labored for weeks over Table 15.3 Monetary Values Variable production cost per unit (C): Selling price per unit (S): Salvage value per unit (V): Fixed production cost (F): $80 $100 $30 $100,000 its new design for the coming winter season. It is now time to decide how many ski jackets to produce in this production run. Because of the lead times involved, no other production runs will be possible during the season. Predicting ski jacket sales months in advance of the selling season can be quite tricky. Egress has been in operation for only three years, and its ski jacket designs were quite successful in two of those years. Based on realized sales from the last three years, current economic conditions, and professional judgment, 12 Egress employees have independently estimated demand for their new design for the upcoming season. Their estimates are listed in and equipment is F. This cost is incurred regardless of the size of the production run. Questions 1. Egress management believes that a normal distribution is a reasonable model for the unknown demand in the coming year. What mean and standard deviation should Egress use for the demand distribution? Table 15.2. 2. Use a spreadsheet model to simulate 1000 possible outcomes for demand in the coming year. Based on these scenarios, what is the expected profit if Egress produces Q = 7800 ski jackets? What is the expected profit if Egress produces Q = 12,000 ski jackets? What is the standard deviation of profit in these two cases? Table 15.2 Estimated Demands 14,000 13,000 14,000 14,000 15,500 16,000 8000 5000 11,000 8000 15,000 3. Based on the same 1000 scenarios, how many ski jackets should Egress produce to maximize expected profit? Call this quantity Q. 10,500 4. Should Q equal mean demand or not? Explain. To assist in the decision on the number of units for the production run, management has gathered the data in Table 15.3. Note that S is the price Egress charges retailers. Any ski jackets that do not sell during the season can be sold by Egress to discounters for V per jacket. The fixed cost of plant 5. Create a histogram of profit at the production level Q. Create a histogram of profit when the production level Q equals mean demand. What is the probability of a loss greater than $100,000 in each case? OCengage Learning ©Cengage Learning
Transcribed Image Text:CASE 15.1 SKI JACKET PRODUCTION gress, Inc., is a small company that designs, -produces, and sells ski jackets and other coats. The creative design team has labored for weeks over Table 15.3 Monetary Values Variable production cost per unit (C): Selling price per unit (S): Salvage value per unit (V): Fixed production cost (F): $80 $100 $30 $100,000 its new design for the coming winter season. It is now time to decide how many ski jackets to produce in this production run. Because of the lead times involved, no other production runs will be possible during the season. Predicting ski jacket sales months in advance of the selling season can be quite tricky. Egress has been in operation for only three years, and its ski jacket designs were quite successful in two of those years. Based on realized sales from the last three years, current economic conditions, and professional judgment, 12 Egress employees have independently estimated demand for their new design for the upcoming season. Their estimates are listed in and equipment is F. This cost is incurred regardless of the size of the production run. Questions 1. Egress management believes that a normal distribution is a reasonable model for the unknown demand in the coming year. What mean and standard deviation should Egress use for the demand distribution? Table 15.2. 2. Use a spreadsheet model to simulate 1000 possible outcomes for demand in the coming year. Based on these scenarios, what is the expected profit if Egress produces Q = 7800 ski jackets? What is the expected profit if Egress produces Q = 12,000 ski jackets? What is the standard deviation of profit in these two cases? Table 15.2 Estimated Demands 14,000 13,000 14,000 14,000 15,500 16,000 8000 5000 11,000 8000 15,000 3. Based on the same 1000 scenarios, how many ski jackets should Egress produce to maximize expected profit? Call this quantity Q. 10,500 4. Should Q equal mean demand or not? Explain. To assist in the decision on the number of units for the production run, management has gathered the data in Table 15.3. Note that S is the price Egress charges retailers. Any ski jackets that do not sell during the season can be sold by Egress to discounters for V per jacket. The fixed cost of plant 5. Create a histogram of profit at the production level Q. Create a histogram of profit when the production level Q equals mean demand. What is the probability of a loss greater than $100,000 in each case? OCengage Learning ©Cengage Learning
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 5 steps with 4 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Application of Algebra
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, probability and related others by exploring similar questions and additional content below.
Recommended textbooks for you
A First Course in Probability (10th Edition)
A First Course in Probability (10th Edition)
Probability
ISBN:
9780134753119
Author:
Sheldon Ross
Publisher:
PEARSON
A First Course in Probability
A First Course in Probability
Probability
ISBN:
9780321794772
Author:
Sheldon Ross
Publisher:
PEARSON
SEE MORE TEXTBOOKS