LaVar, Inc

Multiple Choice

LaVar, Inc. has obtained probability estimates from its production and sales departments regarding the costs and selling prices it can anticipate for a new product line. The company is uncertain as to which combination of costs and selling prices will occur. The best method for determining the expected outcome of the investment, based on an assumed probability distribution associated both sales and costs, is:

A) Monte Carlo simulation (MCS) .
B) The analytic hierarchy process (AHP) .
C) Correlation analysis.
D) Multiple regression analysis.
E) Linear programming.