Mac's Lighting Fixtures (MLF) is a small manufacturer of custom lighting fixtures. MLFowns a 25,000 square foot facility in South Lake Union in Seattle and has occupied the
space for 60 years. MLF has net working capital of $500K. Their annual sales are expectedto be around $2,000K per year. On a $1 of revenue, Mac expects that the cost of the
finished fixtures is about $0.80. This figure includes about $20K per year in depreciationexpense. Selling, general and administrative expenses are expected to run about $0.15 on
every dollar of sales. MLF needs to invest about $20K per year on plant and equipment tokeep up with wear and tear. Mac does not expect to make any investments in working
capital. Firms with similar risk in the capital market have discount rates of 10%. MLF has$250K in debt. Mac owns 51% of the MLFs equity and his brother Bill owns 49%

 
Discuss the potential of applying simulation concepts to supplement/enhance your findings in that analysis.  

Identify the information/parameter(s) of the chosen problem that is (are) likely "uncertain" in the real-world situation.

Briefly outline, in the context of the problem chosen, the value of incorporating uncertainties in the analysis.

Answer rating: 100% (QA)

In the context of analyzing Macs Lighting Fixtures MLF simulation concepts can be a valuable tool to supplement and enhance the analysis Simulation involves creating a model that mimics the realworld ... View the full answer