Statistics

Statistics Question

Q uestion

Decision making techniques in excel

Description:

problem should be solved with excel and consist some explanation s described below.

 An optimization model about logistics and transportation

  1. A forecasting model about logistics and transportation

Y=a+bx

For cost

  1. Apply a multiple-objective decision making model (AHP) to make a decision of DC (distribution centre) location selection
  2. simulation .

Monet Inc., is a small company that designs, produces, and sells ski jackets and other coats. The creative design team has labored for weeks over its new design for the coming winter season. It is now time to decide how many ski jackets to produce involved, no other production runs will be possible during the season. Predicting ski jacket sales months in advance of the selling season can be tricky. Monet has been in operation for only 3 years, and its ski jacket designs were quite successful in 2 of those years. Based on realized sales from the last 3 years, current economic conditions, and professional judgment, 12 Monet employees have independently estimated demand for their new design for the upcoming season. Their estimates are listed in table 1.

 

 

To assist in the decision on the number of units for the production run, management has gathered the data in table 2. Note that S is the price Egress charges retailers. Any ski jackets that do not sell during the season can be sold by Monet to discounters for V per jacket. The fixed cost of plant and equipment is F. This cost is incurred irrespective of the size of the production run.

 Table 2: Monetary Values

 

 

Questions:

  1. Monet management believes that a normal distribution is a reasonable model for the unknown demand in the coming year. What mean and standard deviation should Monet use for the demand distribution?
  2. Use a spreadsheet model to simulate 200 possible outcomes for demand in the coming year. Based on these scenarios, what is the expected average profit if Monet produces Q=7800 ski jackets? What is the expected average profit if Monet s produces Q=12,000 ski jackets? What is the standard deviation of profit in these two cases? what is the probability of a loss greater than $100,000 in each case?
  3. Based on the same 200 scenarios, how many ski jackets should Monet produce to maximize expected average profit? Call this quantity Q and draw a chart to interpret the result.(15%)

 

 

Students should explain their ideas by characterizing the modeling process as a seven-step procedure:

  • define the problem
  • observe the system and collect data
  • formulate a mathematical model
  • verify the model and use the model for prediction
  • select a suitable alternative
  • present the results of the study to the organization

implement and evaluate recommendations

 

 

Table 1: estimated demands

14,000

13,000

14,000

14,000

15,500

10,500

16,000

8,000

5,000

11,000

8,000

15,000

 

 

 Table 2: Monetary Values

Variable production cost per unit(C)

$80

Selling price per unit(S)

$100

Salvage value per unit(V)

$30

Fixed production cost(F)

$100,000

 



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    Statistics

    Submitted by PROFSTAN on April 26th, 2016 17:29

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