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Trial 1 2 3 4 5 6 7 8 9 10 Total Average Random Number 28 14 44 51 91 38 79 70 98 11 Materials Cost per Unit 35 33 38 38 39 35 39 38 39 33 367 36.7...
***I need help with Part B!***I have attached part A!Management has asked you to help estimate the most likely cost per unit to produce a new product so that they can project profits at different selling prices. You are to simulate cost behavior using probabilistic simulation (Monte Carlo simulation) and have been provided with the following cost estimates. Materials cost will range between $33 and $39 per unit, labor between $22 and $28 per unit, and utilities between $3 and $6 per unit. The probability distributions of cost per unit are as follows.Materials:• The probability is .18 that the cost will be $33.• The probability is .23 that the cost will be $35.• The probability is .32 that the cost will be $38.• The probability is .27 that the cost will be $39.Labor:• The probability is .12 that the cost will be $22.• The probability is .18 that the cost will be $23.• The probability is .22 that the cost will be $24.• The probability is .28 that the cost will be $25.• The probability is .20 that the cost will be $28.Utilities:• The probability is .26 that the cost will be $3.• The probability is .43 that the cost will be $4.• The probability is .31 that the cost will be $6.Task:A. Complete the attached “Simulation Template” to determine the following costs:1. Average materials cost per unit2. Average labor cost per unit3. Average utilities cost per unit4. Average total cost per unitNote: Run 10 trials using the random numbers that are provided on the “Simulation Template” for each probability distribution. Use the random numbers in the exact sequence that they appear on the template for each cost.Note: Submit your completed spreadsheet as an attachment to this task.B. Determine the selling price per unit that should be established for this product using your simulation results and assuming that the company wants to realize an average markup of $20 on each unit sold.
