Mallipeddi Waste Disposal, $GmbH,$ headquartered in the industrial city of Heidleheim, Germany, operates seven specially

constructed semi$-$trailers and cabs for commercial long$-$distance hauling of radioactive waste materials. Each truck

averages one completed load per week, picking up the radioactive containers from chemical companies and other

manufacturers in central Europe. The loads are carefully driven to a government site near Flenzheim a manufacturing

center in Germany. Currently, pickups are made in eight countries: Italy, Germany, Austria, France, Belgium, Netherlands,

Denmark, and Poland.

Mallipeddi maintains an office in each country's capital. Staffing includes a manager and a secretary at each national

office and a part$-$time lobbyist$/$attorney to assist in the many political, cross$-$cultural, border, and legal issues that arise in

the nuclear waste disposal industry.

Victoria Mallipeddi, owner of the company, is seriously considering dropping Italy as a source of business. Last year, only

$25$ truckloads of waste were handled there. Since textile manufacturers in northern Italy are the primary source of trucking

for Mallipeddi, the size and revenues from their shipments will determine if it is profitable to retain an office and do

business in that country.

To analyze the Italian market, Mallipeddi gathered data on last year's shipments and revenues from Italy. The results are

summarized below. Each of the $25$ trucks that were loaded in Italy last year carried between $30$ and $50$ barrels of waste.

The income generated per barrel differed significantly $($ranging from $500$ to $800$ Euros, $($symbol $"{}^{**})$ based on the type of

radioactive material being loaded and the weight of the barrels to be shipped. The number of barrels hauled and the

revenue per barrel are independent of each other.

Victoria theorizes that if she simulates $25$ truckloads out of Italy she could determine if it is profitable to continue to

operate there next year. She estimates that each shipment to the Flenzheim dump site costs $8750,$ including driver,

gasoline, and truck expenses. Other cargo and loading and unloading costs average $1250$ per shipment. The costs to

operate the office in Italy is $420,000$ per year, including salaries and indirect overhead costs from the home office in

Heidleheim. Develop a simulation model to help Victoria decide whether to maintain a business presence in Italy. Will the

shipments in Italy next year generate enough revenues to cover Mallipeddi's costs there?

Requirements:

Develop a simulation model to solve the problem. Answers all questions completely.

Victoria wonders what changes to the baseline economics $($operational revenue$/$expenses$,$ fixed costs$)$ would be

the best to improve the chances of making money in Italy. She decides to study the effects of seeking new

business or decreasing office costs. Using Scenario Manager, determine the profit margin for the combinations

listed below, then recommend the best path to achieve an operational "break$-$even" scenario to Victoria $($pursue

extra business or reduce overhead costs$).$

a$.$ Run the model for $23,25,27,29,$ and $31$ truckloads per year.

b$.$ By adjusting staff and office space, Victoria can alter overhead. Overhead costs can be $350,000,$

$375,000,400,000$ or $420,000.$