Excel Modeling & Monte Carlo Risk Simulation

Case Study: Calambra Olive Oil

1. Assignment Expectations \& Problems to be Answered:

The goal of this assignment is for you to help Frank Lockfeld better understand the risks he is taking with his Calambra venture and to help him figure out how many gallons of olive oil he should order in 1994. We will analyze this case in two steps:

Part A:

1. Read Calambra Olive Oil Case Study (parts A \& B) to understand the situation faced by Frank Lockfeld and the facts of the case.
2. Study the spreadsheet (liquidgold.xIs), which includes ranges provided by Frank Lockfeld in the resulting tornado chart, identifying the Top 4 important uncertainties in the problem.

- See Tornado Analysis Specifics in Appendix Section for a better understanding of Calambra Olive Oil Tornado chart output.

Part B:

1. Based on additional information given in the Calambra Olive Oil case study (part B - dialogue section), regarding the identified top 4 important uncertainties (from tornado chart), you must develop an $\underline{\text { Excel }}$ simulation model to answer the following key questions of the case:

1. How much olive oil should Frank Lockfeld order?

1. Prove this by providing appropriate Crystal Ball distribution simulation results (charts \& statistics) based on Excel model.

2) How risky is this venture?

Note: Remember this is Decision Modeling, so you must show and tell why based on your model calculations \& simulation results.

1. Generate Risk Profile/Probability Distribution - by generating Crystal Ball Overlay charts of risk simulation results regarding probability distribution - See Appendix (Modeling Probabilistic Dependence) & Instructions Section II for Crystal Ball (CB) Software Hints for Assignment Completion.
2. Prepare a table describing the statistics of the distributions:

- In Crystal Ball using Analyze, Extract Data, Statistics

- Overlay chart of distribution (See Appendix Risk Profiles).

3) A Crystal Ball report that a) documents your assumptions and b) shows the statistics for the main forecasts in your model.

Please think about what you include: don't make your professor wade through lots of irrelevant or redundant documentation.

Describe your analysis and recommendations to Frank Lockfeld. Write this part using complete sentence bullet points under generated simulation graphs describing justification.

Price: $18.32

Solution: The downloadable solution consists of 10 pages, 832 words and 5 charts.
Deliverable: Word Document