Create the frequency distribution

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Reference no: EM133532367

Question: A plant manager is considering investing in a new $37,000 machine. Use of the new machine is expected to generate a cash flow of about $8,000 per year for each of the next 5 years. However, the cash flow is uncertain, and the manager estimates that the actual cash flow will be normally distributed with a mean of $8,000 and a standard deviation of $500. The discount rate is set at 8% and assumed to remain constant over the next 5 years. The company evaluates capital investments using net present value for the cash flow over the next 5 years as the model's output (model's output formula is in cell E31 and you don't need to make any changes to it.) Develop an appropriate simulation model (with 2000 trails) and conduct experiments and statistical output analysis to answer the following questions (the location of your data table is designated in 10 columns and 200 rows). A) Find the average net present value for this investment, and enter your answer (using an appropriate formula) in the designated cell (B35). B) Create the frequency distribution (using FREQUENCY function, NOT histogram tool) and the histogram for the plant's net present value of the

Reference no: EM133532367

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