Quantative Methods for Business. Managerial and scientific report Best Bike Ltd. Simulation with Excel Cristal Ball.

Table of contents. Managerial Report 1.Introduction Best roulette wheels Ltd. designs, produces and markets a wide vicissitude of bicycles. Currently it is evaluating cardinal b ar-assed product proposals that have reached the terminal planning stage, namely a road- and mountain bike. BestBikes Ltd. can solely produce one of the two proposed bikes. BestBikes call fors to select the bike with the highest clear on coronation (ROI) and wants to assign the amount of risk. The calculation of the ROI symmetry by BestBikes Ltd. for both proposals gives close identical results and in that locationfore more(prenominal) in depth digest is required. With almost equal ROI ratios the subject risk and the impact of these risks on the spread in the potential ROI becomes significant. itinerary Bike softwood Bike Forecasted uttermost sales4,000Forecasted maximum sales2,500 Sales price2,400Sales price3,600 Initial investiture240,000Initial investment280,000 Fixed equal60,000Fi xed cost100,000 Variable cost1,333Variable cost1,600 Table 1.1: presumption figures for street and Mountain Bike 1 2.Calculating ROI The uncertainties that are grand for this investment are: The sales volume The investment The uncertain cost of each product The initial investment for the Road Bike has a conventionality distribution with a mean of 240,000 and a threadbare deviation of 20,000. The changeable cost has of the Road Bike has a triangular distribution with min. and max.

note value 750 and 2,000 on an individual basis and the most likely value set of 1,250. For the Mountain Bike th e initial investment has a triangular distri! bution with min. and max. value of 100,000 and 600,000 respectively and the most potential value set of 150,000. The variable costs of the Mountain Bike follow a normal distribution with mean of 1.600 and standard deviation of 600. When using quartz glass Ball there is a possibility to develop a simulation type which enables you to give insight in the investment problem that BestBike encounters. Stated down the stairs are the... If you want to get a full essay, tell apart it on our website: OrderCustomPaper.com

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