SENSITIVITY TESTING As a facility manager of a ready-mix concrete plant, you are going to analyze the parameters affecting the yearly profit . There are 7 main variables affecting profitability: Hourly Production (HP), Yearly Working Hours (YWH), Unit Cost of the Cement (UCC), Unit Cost of the Aggregate (UCA), Unit Cost of the Water (UCW), Unit Cost of the Chemical Additive (UCCA), and Operational Cost Percentage (OCP). You are going to carry out a sensitivity analysis to find out the most important variables. The best estimates of these variables are given below: Hourly Production (HP) = 75 m/hour Yearly Working Hours (YWH) = 2000 hours Unit Cost of the Cement (UCC) = 0.3 TL/kg Unit Cost of the Aggregate (UCA) = 50 TL/ton Unit Cost of the Water (UCW) = 0.013 TL/liter Unit Cost of the Chemical Additive (UCCA) = 3.5 TL liter Operational Cost Percentage (OCP) = 8% There are some other parameters affecting the yearly profit: Total Material Cost (TMC), Total Operational Cost (TOC), Total Workmanship Cost (TWC), and Selling Price of the Concrete (SPC). However, all of them depend on the 7 parameters given above. In other words, they are not a direct input to the sensitivity analysis. Total Material Cost (TMC) is the summation of the costs of cement, aggregate, water, and chemical additive. The cost of each material is calculated by multiplying the total amount of the material with its unit cost. For this purpose, the amount of each material in a 1 m2 concrete is given below (They are fix values): Amount of the Cement = 330 kg/m3 Amount of the Aggregate = 1150 kg/m3 Amount of the Water = 215 liter/m2 Amount of the Chemical Additive = 5 liter/m Total Operational Cost (TOC) is calculated by multiplying Total Material Cost (TMC) with Operational Cost Percentage (OCP), as given below: TOC = TMC X OCP Total Workmanship Cost (TWC) is calculated by multiplying Yearly Working Hours (YWH) with a fixed coefficient, as given below: TWC = 320 x YWH . Selling Price of the Concrete (SPC) is estimated according to Hourly Production (HP), as formulated below: SPC = 240 - 0.15 x HP By considering all of these parameters, the Yearly Profit (YP) of the ready-mix concrete plant is calculated according to the following formula: YP= HP x YWH x SPC - TWC - TOC - TMC By using the given information, you are required to: 1. Calculate the "Yearly Profit (YP)" by using the best estimate values for each parameter 2. Cany out a sensitivity testing for the 7 variable (by + or -10% change in each step) to find the variables that have the highest impact on the yearly profit. Draw a spider diagram (% change in variables at the y-axis and yearly profit at the x-axis). 3. Comment on the results. SENSITIVITY TESTING As a facility manager of a ready-mix concrete plant, you are going to analyze the parameters affecting the yearly profit . There are 7 main variables affecting profitability: Hourly Production (HP), Yearly Working Hours (YWH), Unit Cost of the Cement (UCC), Unit Cost of the Aggregate (UCA), Unit Cost of the Water (UCW), Unit Cost of the Chemical Additive (UCCA), and Operational Cost Percentage (OCP). You are going to carry out a sensitivity analysis to find out the most important variables. The best estimates of these variables are given below: Hourly Production (HP) = 75 m/hour Yearly Working Hours (YWH) = 2000 hours Unit Cost of the Cement (UCC) = 0.3 TL/kg Unit Cost of the Aggregate (UCA) = 50 TL/ton Unit Cost of the Water (UCW) = 0.013 TL/liter Unit Cost of the Chemical Additive (UCCA) = 3.5 TL liter Operational Cost Percentage (OCP) = 8% There are some other parameters affecting the yearly profit: Total Material Cost (TMC), Total Operational Cost (TOC), Total Workmanship Cost (TWC), and Selling Price of the Concrete (SPC). However, all of them depend on the 7 parameters given above. In other words, they are not a direct input to the sensitivity analysis. Total Material Cost (TMC) is the summation of the costs of cement, aggregate, water, and chemical additive. The cost of each material is calculated by multiplying the total amount of the material with its unit cost. For this purpose, the amount of each material in a 1 m2 concrete is given below (They are fix values): Amount of the Cement = 330 kg/m3 Amount of the Aggregate = 1150 kg/m3 Amount of the Water = 215 liter/m2 Amount of the Chemical Additive = 5 liter/m Total Operational Cost (TOC) is calculated by multiplying Total Material Cost (TMC) with Operational Cost Percentage (OCP), as given below: TOC = TMC X OCP Total Workmanship Cost (TWC) is calculated by multiplying Yearly Working Hours (YWH) with a fixed coefficient, as given below: TWC = 320 x YWH . Selling Price of the Concrete (SPC) is estimated according to Hourly Production (HP), as formulated below: SPC = 240 - 0.15 x HP By considering all of these parameters, the Yearly Profit (YP) of the ready-mix concrete plant is calculated according to the following formula: YP= HP x YWH x SPC - TWC - TOC - TMC By using the given information, you are required to: 1. Calculate the "Yearly Profit (YP)" by using the best estimate values for each parameter 2. Cany out a sensitivity testing for the 7 variable (by + or -10% change in each step) to find the variables that have the highest impact on the yearly profit. Draw a spider diagram (% change in variables at the y-axis and yearly profit at the x-axis). 3. Comment on the results