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QUESTION: Mean unit variable cost from simulation? GM is trying to decide whether to introduce a new car model. The selling price for the car

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QUESTION: Mean unit variable cost from simulation?

GM is trying to decide whether to introduce a new car model. The selling price for the car will be $32,000. The fixed cost of developing the car is assumed to be uniformly distributed between $600 million and $1.1 billion. The demand for the car is described by a normal distribution with a mean of 120,000 units and a standard deviation of 30,000. The unit variable cost for the car is distributed as shown below. Cost per Unit $17,000 $19,000 $20,000 $22,000 Probability 0.15 0.35 0.30 0.20 New Car Input Data All the $ amounts are in $thousands Unit Selling Price $32 Unit Variable Cost Fixed Cost (Uniform Distribution) Lower bound $600,000 Upper bound $1,100,000 Probability 0.15 0.35 0.30 0.20 Demand (Normal Distribution) Mean Standard Dev Lower Limit 0.00 0.15 0.50 0.80 Upper Limit 0.15 0.50 0.80 1.00 Cost per Unit $17 $19 $20 120,000 30,000 $22 (Selling price - Unit VC) Dmd - FC Simulation Trials (1) 2 ) (3) (5) (6) (8) Trial Fixed Cost Unit Variable Cost Demand Profit 000 AWN- Random Number 0.957 0.040 0.757 0.807 0.798 0.854 0.697 0.796 0.951 0.936 0.245 0.976 0.785 0.568 0.855 (4) Random Number 0.611 0.443 0.970 0.253 0.191 0.495 0.696 0.441 0.968 0.140 0.569 0.509 0.580 0.091 0.229 Random Number 0.652 0.331 0.154 0.883 0.600 0.192 0.373 0.909 0.461 0.175 0.075 0.985 0.777 0.421 0.936 9 10 996 997 998 999 1000 #DIV/0! #DIV/0! #DIV/0! #DIV/0! GM is trying to decide whether to introduce a new car model. The selling price for the car will be $32,000. The fixed cost of developing the car is assumed to be uniformly distributed between $600 million and $1.1 billion. The demand for the car is described by a normal distribution with a mean of 120,000 units and a standard deviation of 30,000. The unit variable cost for the car is distributed as shown below. Cost per Unit $17,000 $19,000 $20,000 $22,000 Probability 0.15 0.35 0.30 0.20 New Car Input Data All the $ amounts are in $thousands Unit Selling Price $32 Unit Variable Cost Fixed Cost (Uniform Distribution) Lower bound $600,000 Upper bound $1,100,000 Probability 0.15 0.35 0.30 0.20 Demand (Normal Distribution) Mean Standard Dev Lower Limit 0.00 0.15 0.50 0.80 Upper Limit 0.15 0.50 0.80 1.00 Cost per Unit $17 $19 $20 120,000 30,000 $22 (Selling price - Unit VC) Dmd - FC Simulation Trials (1) 2 ) (3) (5) (6) (8) Trial Fixed Cost Unit Variable Cost Demand Profit 000 AWN- Random Number 0.957 0.040 0.757 0.807 0.798 0.854 0.697 0.796 0.951 0.936 0.245 0.976 0.785 0.568 0.855 (4) Random Number 0.611 0.443 0.970 0.253 0.191 0.495 0.696 0.441 0.968 0.140 0.569 0.509 0.580 0.091 0.229 Random Number 0.652 0.331 0.154 0.883 0.600 0.192 0.373 0.909 0.461 0.175 0.075 0.985 0.777 0.421 0.936 9 10 996 997 998 999 1000 #DIV/0! #DIV/0! #DIV/0! #DIV/0

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