The management of Madeira Computing is considering the introduction of a wearable electronic device with the functionality of a phone. The fixed cost to launch this new product is $300,000. The variable cost for the product is expected to be between $160 and $240, with a most likely value (mode) of $200 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 being the most likely.

Cost Distribution: Assume that the variable cost can be well-approximated by a uniform random variable with a minimum of $160 and a maximum of $240.

Demand Distribution: Assume that the product demand can be well-approximated as 1,000 times the value of a gamma random variable with an alpha parameter of 3 and a beta parameter of 2.

To further assess risk, develop a spreadsheet simulation model to estimate the average profit and the probability that the project will result in a loss. Make sure to design your spreadsheet such that it is capable of simulating at least n = 1000 observations (aka "simulated replications") of profit.

Use your simulated data (n=1000) to provide an estimate of the probability that the project will result in a loss, p .