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Profit Analysis

Profit Analysis. A consumer electronics firm produces a line of battery rechargers for cell phones. The following distributions apply:

Unit price - triangular with a minimum of $18.95, most likely value of $24.95, and maximum of $26.95

Unit cost - uniform with a minimum of $12.00 and a maximum of $15.00

Quantity sold - 10,000 - 250*Unit price, plus a random term given by a normal distribution with a mean of 0 and a standard deviation of 10

Fixed costs - normal with a mean of $30,000 and a standard deviation of $5,000

a. What is the expected profit?
b. what is the probability of a loss?
c. What is the maximum loss?

*** Answer the questions and provide an Excel file with that captures the Forecast windows that justify your answers.

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Please see attached file for step by step details on your ...

Solution Summary

The excel file contains:
1. Deterministic model
2. Stochastic mode
3. Steps to define parameters with screen shots
4. Simulation output with screen shots