Parameter value changes:

Repeat the risk-analysis simulation (No of trials = 500) in section 11.1 with the following changes (keep values of other parameters unchanged as in section 11.1):

Selling price = $278 Fixed cost =$1,200,000

• For direct labor cost- change the costs and probabilities (cost and probability in that order) like this: ($44, 0.25); ($45, 0.15); ($46, 0.25); ($47, 0.10); ($48, 0.25) Note: the range of cost is now $44-$48
• For parts cost- uniform distribution lowest value 95 and highest value 115
• Normal distribution of demand- Mean 13,300 and standard deviation 4,000

This is an example of how it should be completed.

D 0