Question 2 (Simulation)The management of Brinkley Corporation is interested in using simulation to estimate the profit perunit for a new product. Probability distributions for the purchase cost, the labor cost, and thetransportation cost are as follows:LabourTransportationCost ($)PurchaseCostCost ($)Probability($)ProbabilityProbability100.25200.130.75110.45220.250.25120.3240.35250.3Assume that these are the only costs and that the selling price for the product will be $45 per unit.a. Provide the base (most likely)-case, worst-case, and best-case calculations for the profit per unit.b. Set up intervals of random numbers that can be used to randomly generate the three costcomponents, and find the average profit based on 10 simulation trials. Show your simulationmodel (including the formulas sed) as developed with Excel.c. Using the random numbers 0.3726, 0.5839, and 0.8275, calculate the profit per unit. (.d. Management believes the project may not be profitable if the profit per unit is less than $5.Explain how simulation can be used to estimate the probability the profit per unit will be less than$5.

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MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

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Problem 1P

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The management of Brinkley Corporation is interested in using simulation to estimate the profit per unit for a new product. Probability distributions for the purchase cost, the labor cost, and the transportation cost are as follows: