Chapter $12$: Simulation and Risk Analysis

Chapter $12$ Simulation and Risk Analysis

$463$

CASE: PERFORMANCE LAWN EQUIPMENT

In one of PLE's manufacturing facilities, a drill press that has three drill bits is used to fabricate metal parts. Drill bits break occasionally and need to be replaced. The present policy is to replace a drill bit when it breaks or can no longer be used. The operations manager is considering a different policy in which all three drill bits are replaced when any one bit breaks or needs replacement. The rationale is that this would reduce downtime. It costs $$200$ each time the drill press must be shut down. A drill bit costs $$85,$ and the variable cost of replacing a drill bit is $$15$

per bit. Develop spreadsheet simulation models to determine the total cost for each policy over $1,000$ hours and make a recommendation. Image has the complete question. Please provide everything in detail and show all excel formulas used. Will give thumbs up$!$ Thank you!