Question: Show work through excel. Use the information below to answer the following question(s). Below is a spreadsheet for Trance Electronics. A Trance Electronics 1 2
Show work through excel.
Use the information below to answer the following question(s). Below is a spreadsheet for Trance Electronics. A Trance Electronics 1 2 3 14 Data 15 16 7 18 Market size Unit (monthly Rx) revenue Unit (monthly Rx) cost Discount rate 20,000,000 $ 120.00 $ 50.00 1896 Project costs R&D Clinical Trials Total Project Costs $ 750,000,000 $ 100,000,000 Model 3 496 4 1496 496 496 19 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Year Market growth factor Market size Market share growth rate Market share Sales 1896 1896 1896 1896 796 Annual revenue Annual costs Profit Cumulative net profit Net present value Suppose that the project manager of Trance Electronics has identified the following uncertain variables in the model and the distributions and parameters that describe them, as follows: Market size: normal with mean of 20,000,000 units and standard deviation of 4,000,000 units. R&D costs: uniform between $600,000,000 and $800,000,000. Clinical trial costs: lognormal with mean of $150,000,000 and standard deviation $30,000,000. Annual market growth factor: triangular with minimum = 2%, maximum = 6%, and most likely = 3%. Annual market share growth rate: triangular with minimum = 15%, maximum = 25%, and most likely = 20%. The number of trials per simulation is equal to 10,000 at a Sim. Random Seed of 2. Run the simulation and answer the following questions using the Risk Solver Platform. What cumulative profit in the fifth year is likely to be realized with a probability of 0.50? $144,058,696 $203,676,827 $101,970,955 $78,244,098
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