Question: Rerun the new car simulation from Example 11.4, but now introduce uncertainty into the fixed development cost. Let it be triangularly distributed with parameters $600

Rerun the new car simulation from Example 11.4, but now introduce uncertainty into the fixed development cost. Let it be triangularly distributed with parameters $600 million, $650 million, and $850 million. (You can check that the mean of this distribution is $700 million, the same as the cost given in the example.) Comment on the differences between your output and those in the example. Would you say these differences are important for the company?

Step by Step Solution

3.30 Rating (174 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

The output of the new car simulation with the uncertainty in the fixed development cost is ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Excel file Icon

1497_604767c6b8fa6_838196.xlsx

300 KBs Excel File

Students Have Also Explored These Related Practical Management Science Questions!