Question:

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 $166 and $246, with a most likely value of $206 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.

Model the variable cost as a uniform random variable with a minimum of $166 and a maximum of $246. 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.)

a. Develop a what-if spreadsheet model computing profit (in $) for this product in the base-case, worst-case, and best-case scenarios.

b. What is the average profit (in $)? (Round your answer to the nearest thousand.)

c. What is the probability the project will result in a loss? (Round your answer to three decimal places.)

The diagrams below show three Markov chains, where arrows indicate a non-zero transition probability. A Markov Chain 1 State 1 State 2 State 3 B Markov Chain 2 State 1 State 2 State 3 State 4 C Markov Chain 3 State 1 State 2 State whether each of the chains is: e irreducible . periodic, giving the period. [3]\fEstimation of the activity duration In project scheduling, we usually use a beta distribution to represent the time needed for each activity Probability Pessimistic time Optimistu time Most likely time Time Figure 12.18 Beta distribution of activity times. PERT4. (6 points) Consider the following graph of a probability density function: 1.0 (x) 6 0'0 0.0 0.5 From which of the following distributions does the probability density function graphed above arise? A. the beta distribution with parameters o = 3 and 3 = 3 B. the beta distribution with parameters o = 5 and 3 = 5 C. the normal distribution with parameters / = 0.3 and o = 0.5 D. the beta distribution with parameters o = 2 and 3 = 3