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The financial analyst at Good Taste Candy Company has handed you her Monte Carlo simulation model for Blue Berry Exploding Delicious Gum. She is going

The financial analyst at Good Taste Candy Company has handed you her Monte Carlo simulation model for Blue Berry Exploding Delicious Gum. She is going on leave and you are responsible for taking the model and using it to determine what level of production would be the most profitable for the new Everlasting Awesome Chocolate Peanut Butter Crisp. You have been given the following information:

Probability of Demand distribution:

Demand

Probability

10000

15.00%

250000

25.00%

500000

30.00%

800000

20.00%

Number of Crisp made: 300,000

Cost per Crisp: 45 cents

Price per Crisp: $2.00

Disposal cost per unsold crisp: 7 cents

Build a Monte Carlo Simulation using this data in Excel and answer the following questions:

  • What level of production should you choose?
  • What level of production should you choose if the price cost up to $2.50 and the demand distribution changes to?

Demand

Probability

10,000

15%

250,000

45%

500,000

35%

800,000

5%

Save your assignment as a Microsoft Excel document.

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