Business, 06.04.2021 04:40, derbraz6770
The management of Madeira Computing is considering the introduction of a wearable electronic device with the functionality of a laptop computer and phone. The fixed cost to launch this new product is $300,000. The variable cost for the product is expected to be between $167 and $247, with a most likely value of $207 per unit. The product will sell for $300 per unit. Demand for the product is expected to range from 0 to approximately 20,000 units, with 4,000 units the most likely. (a) Develop a what-if spreadsheet model computing profit (in $) for this product in the base-case, worst-case, and best-case scenarios. base-case $ worst-case $ best-case $ (b) Model the variable cost as a uniform random variable with a minimum of $167 and a maximum of $247. Model the product demand as 1,000 times the value of a gamma random variable with an alpha parameter of 3 and a beta parameter of 2. Construct a simulation model to estimate the average profit and the probability that the project will result in a loss. (Use at least 1,000 trials.) What is the average profit (in $)
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