Describe expected monetary value, Operation Management

Assignment Help:

XYZ coating company has reviewed four new processes for improving their coating line. The four processes, labeled A, B, C, and D use different technology and have different capacities. All the processes have the same level of production and the lifetime. The four states of nature represent four levels of consumer acceptance of the firm's products. Values in the table are net present value of future profits in millions of dollars. Forecasts indicate that there is a 0.4 probability of acceptance level 1, 0.3 chance of acceptance level 2, 0.6 chance of acceptance level 3, and 0.5 change of acceptance level 4. Consumer Acceptance Level (states of nature) 1 2 3 4 Alternative A 1 2 3 4 35 55 85 165 Alternative B 1 2 3 4 -105 -5 155 225 Alternative c 1 2 3 4 75 85 75 65 Alternative D 1 2 3 4 55 55 75 65 Using the criterion of expected monetary value, which production alternative should be chosen?


Related Discussions:- Describe expected monetary value

Explain own personal devices used for work, BYOD and we are reading so much...

BYOD and we are reading so much about BYOD (bring-your-own-device). Are the mobile devices you use for business owned by the company or are they your own personal devices used for

Linear programming, classification of linear programming on the basis of st...

classification of linear programming on the basis of structure

Ch 6, I-mart is a discount optical shop that can fill most prescription ord...

I-mart is a discount optical shop that can fill most prescription orders in around 1 hour. The management is analyzing the processes at the store. There currently is one person ass

Explain bill could protect the data and systems, Make a list of five ways t...

Make a list of five ways that Bill could protect the data and systems that he is going to put in place. Consider the type of data and systems that would be relevant to Bill's pizz

Create a perceptual map for a particular product, Which of the following da...

Which of the following data are collected from consumers to develop a perceptual map for a particular product? A listing of all prospective brands and products Managerial jud

Define save money before announcing the restructuring plans, Should GM have...

Should GM have taken any additional steps to save money before announcing the restructuring plans?

Find the shipping costs for company a to ship one unit, Company A has four ...

Company A has four plants locating in different cities across the region. There are three markets the company is selling its products to. Currently, each plant can only produce 500

Explain manager able to overcome your resistance, Managers, think back to a...

Managers, think back to a time when a manager announced a change that you, the employee, did not want to adopt. What was the reason(s) for your resistance to change? Was the manage

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd