Risk software, decision modeling help

Mojave Manufacturing Company (MMC) is considering the introduction of a new product. Before deciding, they would like you to do a risk analysis of the situation to assess whether the introduction of the new product is a good idea for the company. The (annual) fixed cost to begin production of the new product is $32,000. The variable cost for the product is uniformly distributed between $15 and $25 per unit. The product will sell for $50 per unit. Annual demand for the product is best described by a normal distribution with a mean of 1300 units and a standard deviation of 375 units. (Assume they produce exactly enough units to meet the annual demand.) 

a. Develop an @RISK simulation model and run it for 1,000 iterations. 

b. According to your simulation results what is the expected annual profit? 

c. According to the simulation results what is the probability of making a loss on this new product?

 d. Would you recommend MMC introduce this new product? Defend your decision using the simulation output data. 

e. How many iterations would you need to estimate expected annual profit for this new product within $50 for a 95 percent confidence level?

Cuban Investors buys real estate, develops it, and resells it for a profit. A new property is available, and Mark Cuban, the president and owner of Cuban Investors, believes it can be sold for $160,000. The current property owner asked for bids and stated that the property will be sold for the highest bid in excess of $100,000. Two competitors will be submitting bids for the property. Cuban does not know what the competitors will bid, but he assumes for planning purposes that the amount bid by each competitor will be uniformly distributed between $100,000 and $150,000. Cuban is considering submitting a bid of anywhere between $120000 and $150000 (in increments of $5000) for the property. He has consulted you to help him decide upon the “right” amount to bid for the property in order to maximize his expected profit. 

a. Let’s assume that Cuban decides to bid $120000. Build a simulation model corresponding to the above scenario and run it for 5000 iterations to answer parts b, c, and d. 

b. Based on your simulation model what is the probability that Cuban will be able to obtain the property with the bid of 120,000? 

c. Please provide a 95% confidence interval on your probability estimate from part b. 

d. What is the expected profit associated with the bid of $120,000?

 e. Rerun your simulation model (5000 iterations each time) using bid amounts of $125000, $130,000, $135,000, $140,000, $145,000 and $150,000. You can either run each simulation separately or use risksimtable as discussed in the live session. Based on these simulations which bid amount value would you recommend to Mark Cuban in order to maximize his expected profit?

Calculate your paper price
Pages (550 words)
Approximate price: -

Why Choose Us

Quality Papers

We value our clients. For this reason, we ensure that each paper is written carefully as per the instructions provided by the client. Our editing team also checks all the papers to ensure that they have been completed as per the expectations.

Professional Academic Writers

Over the years, our Acme Homework has managed to secure the most qualified, reliable and experienced team of writers. The company has also ensured continued training and development of the team members to ensure that it keep up with the rising Academic Trends.

Affordable Prices

Our prices are fairly priced in such a way that ensures affordability. Additionally, you can get a free price quotation by clicking on the "Place Order" button.

On-Time delivery

We pay strict attention on deadlines. For this reason, we ensure that all papers are submitted earlier, even before the deadline indicated by the customer. For this reason, the client can go through the work and review everything.

100% Originality

At Papers Owl, all papers are plagiarism-free as they are written from scratch. We have taken strict measures to ensure that there is no similarity on all papers and that citations are included as per the standards set.

Customer Support 24/7

Our support team is readily available to provide any guidance/help on our platform at any time of the day/night. Feel free to contact us via the Chat window or support email: support@acmehomework.com.

Try it now!

Calculate the price of your order

We'll send you the first draft for approval by at
Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

Papers Owl has stood as the world’s leading custom essay writing services providers. Once you enter all the details in the order form under the place order button, the rest is up to us.


Essay Writing Services

At Papers Owl, we prioritize on all aspects that bring about a good grade such as impeccable grammar, proper structure, zero-plagiarism and conformance to guidelines. Our experienced team of writers will help you completed your essays and other assignments.


Admission and Business Papers

Be assured that you’ll definitely get accepted to the Master’s level program at any university once you enter all the details in the order form. We won’t leave you here; we will also help you secure a good position in your aspired workplace by creating an outstanding resume or portfolio once you place an order.


Editing and Proofreading

Our skilled editing and writing team will help you restructure you paper, paraphrase, correct grammar and replace plagiarized sections on your paper just on time. The service is geared toward eliminating any mistakes and rather enhancing better quality.


Technical papers

We have writers in almost all fields including the most technical fields. You don’t have to worry about the complexity of your paper. Simply enter as much details as possible in the place order section.