A mobile phone manufacturer plans to launch a new product. It buys parts from suppliers and assembles the product at its manufacturing center. The manufacturer has to incur a fixed cost of

$100,000. The mobile phone is priced at $250 per unit. The probabilistic demand is expected to follow a normal distribution with a mean of 2,000 and a standard deviation of 300 mobiles. The direct material cost per product is uniformly distributed with a minimum of 60 and a maximum of 90. A time study conducted at their center gives a probability distribution to direct labor cost per unit as follows:

Direct labor cost per unit Probability

$50 .15

$55 .25

$60 .35

$65 .25 Simulate 100 trials and compute the average profit. LO.1