Download the Excel workbook M7A1_Fast_Decision_Models_V1.02 file [XLSX file, 15.4 KB]. Start Excel. Open the workbook and immediately save it with a new name. Use your name and include the assignment name, e.g Wright_Dawn_M7A1 (Last Name_First Name_M7A1). This will ensure you have a good copy in case you make mistakes. It will also make your instructor happy when grading your work, which is a good thing. • Check to make sure the workbook calculations option is set to Automatic [Formulas tab > Calculation Options section > Automatic]. • The How to Do It videos are not meant to give you background and theory. They are intended to show only the very basics of the Excel process. Be sure you have read the assigned chapters and watched the required videos before you begin this assignment. Outsourcing Decision Connie Smith has asked you to develop some decision models to help her think through options for next year. Fast can produce a part for their 1000 GB SSD internally or outsource its manufacture. Fast has simplified the decision as much as possible and identified all the costs that would result if they decide to manufacture the part in-house to two components: a Fixed Cost (FC) of setting up internal production of $50,000 and a Unit Variable Cost (UVC) of $125. Fast has also identified and calculated the unit cost of outsourcing the part, the Outsourcing Unit Cost (OUC), of $158. The decision comes down to the difference between the cost to manufacture, Total Manufacturing Cost (TMC), and the cost of outsourcing, Total Outsourcing Cost (TOC). The key parameter is uncertain – the Demand (D). For high demand, the FC can be spread over more sales but for lower demand, the FC becomes a burden and it would be more economical to outsource the production of the part. 1. Build a decision model to help Fast choose a path for production of the part. Demand has been estimated to be 1500 units. Find the difference (Delta = TMC – TOC) and recommend a decision as to “Manufacture” or “Outsource.” Build your model using the basic framework for the decision model on the tab 1-Outsourcing Model in the Excel workbook you downloaded. How to Do It: Decision Models in Excel Make sure your model is complete and save your file. 2. Fast believes keeping the internal production line open would have strategic value and is willing to “lose” $100,000 to do that. Copy your completed decision model from part 1 and paste it on the tab 2- Goal Seek. How to Do It: Copy Model Use your decision model with the initial values and Excel’s What If Analysis tool Goal Seek to find the maximum the UVC could be without Delta exceeding $100,000. How to Do It: Goal Seek Make sure the final values found by your Goal Seek