Question: SIM Take Five from Question 10 wants to use simulation to assess the uncertainty around the revenue forecast for their new iPhone app and

SIM Take Five from Question 10 wants to use simulation to assess 

SIM Take Five from Question 10 wants to use simulation to assess the uncertainty around the revenue forecast for their new iPhone app and provides the following assumptions: a. Development can occur in any of Months 2-10 with equally likely probability (revenue could begin in any of Months 3-11) b. The initial sales price will be determined by the month of development as follows: Month 2-4: $3.99 Month 5-7: $2.99 Month 8-10: $1.99 C. Initial monthly sales have a triangular distribution with minimum, most likely, and maximum values of 2,000, 5,000 and 7,000. d. Unit sales growth occurs until the end of Month 12 regardless of the development month. Thus, if development is completed in Month 6, there will be five months of unit sales growth (Months 8-12). If development does not occur until Month 10, there will only be one month of unit sales growth (Month 12). The monthly growth rate is normally distributed with a mean of 12% and a standard deviation of 4%.

Step by Step Solution

3.46 Rating (166 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

Simulation of New Product Launch for Mobile App This simulation will analyze the potential outcomes of launching a new mobile app based on the provide... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!