This is the Sanotronics simulation with 100 trials that was covered in the lecture. Here, we want to illustrate how the results can change when different distributions are used for some of the random variables.

Suppose the following changes occur in the assumptions.

- Parts cost follows a normal distribution with mean of $90 and standard deviation of $10.

- Demand now follows a uniform distribution between 7,500 and 30,000 units.

The appropriate changes have been made in the Excel sheet. Do not change the given random numbers.

Round all answers up to 2 decimal places.

1) What is the direct labor cost per unit for trial 1?

2) What is the parts cost per unit for trial 1?

3) What is the demand for trial 1?

4) What is the mean profit?

5) What is the maximum profit?

5) What is the probability of loss (in %) ?

6) What is the value at risk (rounded to whole $)? Remember to give the absolute value.

7) Is this more or less risky than the original example solved in class?

Sanotronics Simulation with 100 Trials Data Selling Price per Unit $249 Adm/Adv Cost $1,000,000 Direct Labor Cost Lower End of Upper End of Probability Interval Interval 0.1 0.0 0.2 0.1 0.4 0.3 0.2 0.7 0.1 0.9 Expected Direct Labor Cost = Simulation Trials Cost per Unit $43 $44 $45 $46 Lower Bound $47 45.00 Standrard Deviation 7 Parts Cost (Normal Distribution) Mean $90 $10 7 Demand (Uniform D on) 7500 er Bound 30000 7 ' (1 ) ' (2) ' (a) (4)