Questions A, B, C, D, E must be answered

M 0 Q Zeiss Answers Selling Price 13 a) Fixed Cost (Discrete distribution) Q4. (25 points) Zeiss is one of the world's leading makers of camera lenses. For a new line of lenses for Lower Upper smartphones, the profit is computed as: Demand (Normal Distribution) Probability Random No. Random No Cost Mean 60,000 $150,000 Profit = (selling price )*demand - (variable cost/unit) * demand - fixed cost. 0.20 Standard Dev 5,000 0.35 $170,000 $200,000 The demand follows a normal distribution with 0.25 mean = 60,000 0.20 $250,000 and standard deviation = 5,000. (a) Variable Cost (Discrete distribution) As shown, both the variable cost/unit and the fixed cost follows a discrete distribution. Lower Upper Probability Random No. Random No (a) Fill in the random number interval blanks (lower and upper random numbers) in the variable cost and Cost fixed cost tables. 0. 10 0.30 $7 0.30 $8 (b) Simulate 150 profits in the given table and find the mean profit. 0.30 $10 c) What is the value at risk at 5%? (d) What is the probability of making between $150,000 and $300,000 in profits? (e) What is the probability of losing more than $25,000? Simulation Trials Trial Random Var Random Demand Random Number cost/unit Number Number Fixed Cost Profit 0.468 0.519 0.997 0.496 0.220 0.362 Answer: 0.291 0.538 0.847 0. 127 0.472 0.496 (b) Mean Profit 0.209 0.860 0.205 (c) 0. 106 0.929 0.382 0.262 0-09 VaR-5% 0.039 0.017 D. 642 (d) 0.353 Prob. between $150k and $300K profit 0.436 0. 161 0.955 (e) Prob. of losing more than 25k 0.090 0.702 0.967 0.275 0.641 0.508 0.659 0.804 0.563 0.679 0.037 0.966 0.607 0.119 0.902 0.649 0. 172 0.698 0. 123 0.425 0.620 0.458 0.063 0.975 0.809 0.060 0.894 0.371 0.014 0.375 0.014 0.220 0.642 0.331 0.911 0.325 0.676 0.926 0.448 0.461 0.117 0.226 0.837 0. 164 0.398 0. 176 0.889 0.631 0.669 0.382 0.451 0.476 0.048 0.873 0.331 0.799 0.347 0.250 0. 158 0. 186 .666 0.032 0.742 0. 114 0.341 0.736 0.628 0.785 0.799 0.301 0.731 0.827 0.294 0.698 0.163 0. 148 0.203 0.726 0.885 0.976 0.707 0.687 0.217 0.734 0.915 0.921 0.911 0.758 0.814 0.374 0.058 0.536 0.294 0.617 0.976 0. 127 0.745 0.091 0.865 0.948 0.480 0.091 0.375 0.376 0.347 0.722 0.074 D. 846 0.508 0.203 0.632 0.500 0.026 0.655 0.079 0.819 0.086 0.837 0.285 0.227