### Compute profit for the base-case-worst case and best-case

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##### Reference no: EM131192670

The management of Madeira Manufacturing Company is considering the introduction of a wearable electronic device with the functionality of a laptop computer and phone. The fixed cost to launch the new product is \$300,000. The variable cost for the product is expected to be between \$160 and \$240, with a most likely value of \$200 per unit. The product will sell for \$300 per unit. Demand estimates for the product vary widely, ranging from 0 to 20,000 units, with an average of 4000 units.

a. Compute profit for the base-case, worst case, and best-case scenarios

b. Assume the variable cost is a uniform random variable between \$16 and \$24 and the product demand is an exponential random variable with a mean of 4000 units. Construct a simulation model to estimate the mean profit and the probability that the project will result in a loss.

(I'm having trouble with entering information into excel)

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