Swetha Vasu- (G7-Tillman 9:30 section)

IT Global Tech
Excel Workbook Outline:
IT Tech Case
Reference
2
3
30<=X<=60- discrete values
4
Binomial distribution <Prob: 0.85, no of trials:B4> 5
=B3*B4
6
=B2+B3*B4
7
8
=IF(B5<=30, 30-B5,0)
9

Setup cost for the training

Variable cost / trainee
Number of students enrolled
Number of students who pass
Total Variable cost
Fixed+ Variable cost of training

35000
2250
60
25
135000
170000

No. of former students to be

lured
Cost of luring 1 former student
Total cost of luring former
students

25000
125000 =B10*B9

10
11

Total cost to IT tech

295000 =IF(B11=0,B9,B9+B13)

12
13

Miscellaneous Information
Probability of success
Expected # of passes

0.85
51

=ROUND(B4*probability of success,0) approx.

Definition of Cells:
1. Decision (yellow): IT Globaltech has the power to control the number of students who could
enroll in the program. We hence pick Number of students enrolled as the decision cell
2. Assumption cell (green): Number of students who pass can be random, depending on the
circumstances. Given the uncertainty in this value, we define an assumption that corresponds to
a binomial distribution. Every student either passes or fails, and the probability of a pass is 0.85.
The number of trials would be equal to the Number of students enrolled.
3. Forecast (blue): We are keen on predicting a value for the Number of students enrolled for a
minimized total cost. Our forecast hence would correspond the Total cost to IT tech- a value
that we are trying to discern
Decision Table:
We then simulate a decision table for changing values of the definition cell Number of students
enrolled from 30 (minimum requirement) to 60 (max capacity of class)
# of students enrolled Total cost (Simulation 1) Total Cost (Simulation 2) Total Cost (Simulation 3)
30
31
32

215,060.00
196,242.50
178,097.50

214,985.00
196,170.00
178,012.50

215,010.00
196,162.50
178,047.50

Swetha Vasu- (G7-Tillman 9:30 section)

33
161,692.50
161,627.50
161,650.00
34
148,057.50
147,942.50
147,945.00
35
137,715.00
137,567.50
137,610.00
36
130,777.50
130,622.50
130,675.00
37
126,842.50
126,772.50
126,770.00
38
125,240.00
125,147.50
125,177.50
39
125,257.50
125,177.50
125,182.50
40
126,312.50
126,180.00
126,197.50
41
127,900.00
127,770.00
127,807.50
42
129,822.50
129,735.00
129,750.00
43
131,937.50
131,852.50
131,857.50
44
134,110.00
134,047.50
134,042.50
45
136,312.50
136,272.50
136,267.50
46
138,530.00
138,507.50
138,510.00
47
140,760.00
140,757.50
140,752.50
48
143,002.50
143,002.50
143,000.00
49
145,250.00
145,250.00
145,250.00
50
147,500.00
147,500.00
147,500.00
51
149,750.00
149,750.00
149,750.00
52
152,000.00
152,000.00
152,000.00
53
154,250.00
154,250.00
154,250.00
54
156,500.00
156,500.00
156,500.00
55
158,750.00
158,750.00
158,750.00
56
161,000.00
161,000.00
161,000.00
57
163,250.00
163,250.00
163,250.00
58
165,500.00
165,500.00
165,500.00
59
167,750.00
167,750.00
167,750.00
60
170,000.00
170,000.00
170,000.00
=MIN(C/B2:C/B32)
125,240.00
125,147.50
125,177.50
We gather that the minimum cost is $125240 (simulation 1) when the number of enrolled students is
about 38
The following run preferences were incorporated:
Latin Hypercube:
Bin values
Seed values

Simulation 1
100
1000

Simulation 2
100
9999

Simulation 3
500
9999

Swetha Vasu- (G7-Tillman 9:30 section)

Trend Charts:

Forecast Chart (for no. of enrolled students=38)

Total Cost Vs. Number of students enrolled:

Total cost for IT Tech

Total cost (Simulation 1)

250,000.00
200,000.00
150,000.00
100,000.00
50,000.00
0.00
0

10

20

30

40

50

Number of Students enrolled

60

70