PortaCom manufactures notebook computers and related equipment.PortaCom's product design group developed a prototype for a newhigh-quality portable printer. The new printer features aninnovative design and has the potential to capture a significantshare of the portable printer market. Preliminary marketing andfinancial analyses provided the following selling price, first-yearadministrative cost, and first-year advertising cost:
In the simulation model for the PortaCom problem, the precedingvalues are constants and are referred to as parameters of themodel.
The cost of direct labor, the cost of parts, and the first-yeardemand for the printer are not known with certainty and areconsidered probabilistic inputs. At this stage of the planningprocess, PortaCom’s best estimates of these inputs are $45 per unitfor the direct labor cost, $90 per unit for the parts cost, and16000 units for the first-year demand. The standard deviation of5500 units describes the variability in the first-year demand.PortaCom would like an analysis of the first-year profit potentialfor the printer. Because of PortaCom’s tight cash flow situation,management is particularly concerned about the potential for aloss.
Following is the table of random number intervals for generatingvalues of direct labor cost per unit.
The parts cost depends upon the general economy, the overalldemand for parts, and the pricing policy of PortaCom’s partssuppliers. PortaCom believes that the parts cost will range from$85 to $110 per unit. Costs per unit between $85 and $110 areequally likely.
- Problem 12 03 Algorithmic Portacom Manufactures Notebook Computers And Related Equipment Portacom S Product Design Gr 1 (56.42 KiB) Viewed 6 times
The parts cost depends upon the general economy, the overall demand for parts, and the pricing policy of PortaCom's parts suppliers. PortaCom believes that the parts cost will range from $85 to $110 per unit. Costs per unit between $85 and $110 are equally likely. a. Use the random numbers 0.3862, 0.9373, 0.0349, 0.432, and 0.7847 to generate five simulated values for the PortaCom direct labor cost per unit. If required, round your answers to the nearest dollar. Random Number Direct Labor Cost 0.3862 0.9373 0.0349 0.432 0.7847 $ $ $ $ $
b. Use the random numbers 0.5947, 0.3219, 0.1998, 0.5344, and 0.883 to generate five simulated values for the PortaCom parts cost. If required, round your answers to the nearest cent. Random Number Parts cost 0.5947 0.3219 0.1998 0.5344 0.883 0.7912 0.1408 0.5081 $ c. Use the random numbers 0.7912, 0.1408, 0.5081, 0.6543, and 0.2277 and the table for the cumulative standard normal distribution in Appendix B to generate five simulated values for the PortaCom first-year demand. If required, round your answers to the nearest unit. 0.6543 $ Random Number Demand 0.2277 $ $ $