Compute the joining, marginal and posterior probability, Operation Research

Assignment Help:

The Best Corporation is considering making either minor or major repairs to a malfunctioning production process.  When the process is malfunctioning, the percentage of defective items produced seems to be a constant with either   p = 0.10 or p = 0.25.  Defective items are produced randomly, and there is no way Best can tell for sure whether the machine needs minor or major repairs.  If minor repairs are made when p = 0.25, the probability of a defective item is reduced to 0.05.  If minor repairs are made when p = 0.10 or major repairs are made when p = 0.10 or p = 0.25, the proportion of defectives is reduced to zero. The company's prior probability that p = 0.10 is 0.70.  Best has recently received an order for 1000 items.  This item yields Best a profit of $0.50 per unit, except when the company has to pay a $2 penalty cost for each defective item.  Major repairs to the process cost $100 and minor repairs to the process cost $60.  The process cannot be adjusted once a production run has begun. Prior to starting a production run, however, Best can sample (at a cost of $1 per item) items from a trial rum.

Questions

i)      Find Best's optimal course of action if the company is trying to decide between not sampling at all and sampling one item. (Draw, properly label and evaluate the decision tree).

ii)     Find the optimal action for Best if it is willing to consider a sample of either one or two item, (Draw, properly label and evaluate the decision tree).

iii)    Compute the joining probabilities, marginal probabilities and posterior probabilities for (i) and (ii) using MS Excel.

iv)    Use Decision Tree Analysis and find the best strategy.


Related Discussions:- Compute the joining, marginal and posterior probability

ASSIGNMENT PROBLEM, . Explain in brief the phases of Operations Research. 5...

. Explain in brief the phases of Operations Research. 5 +5 = 10 marks (200 - 250 words each) Q3. Solve the following Linear Programming Problem using Simple method. Maximize Z= 3

Analyzing marketing problems and cases , Cases are generally based on certa...

Cases are generally based on certain issues and problems. Diagnostic, analytical and decision making skills help in case solution. A case study or case based assessment is designed

Duality, For every LP formulation there exists another unique linear ...

For every LP formulation there exists another unique linear programming formulation called the 'Dual' (the original formulation is called the 'Primal'). Same data

Answer, A paper mill products two grade of paper viz., X & Y. Because of ra...

A paper mill products two grade of paper viz., X & Y. Because of raw material restriction, it cannot produce more than 400 tons of grade X paper & 300 tons of grade Y paper in a we

Model building is the essence of the operations research app, Model buildin...

Model building is the essence of the operations research approaches?

the simplex method, In large sized linear programming problems, the ...

In large sized linear programming problems, the solution cannot be obtained by the graphical method and hence a more systematic method has to be developed to find

LLP Simple method, Maximize Z= 3x1 + 2X2 Subject to the constraints: X1+ X2...

Maximize Z= 3x1 + 2X2 Subject to the constraints: X1+ X2 = 4 X1 - X2 = 2 X1, X2 = 0 on..

Lpp linear programming problems exercise, Exercise Define the t...

Exercise Define the terms used in LPP. Mention the advantages of LPP. What are the assumptions and limitations of LPP? A firm produces three pro

What do you understand by customs duty, Question 1 What do you understa...

Question 1 What do you understand by customs duty? Explain the taxable events for imported, warehoused and exported goods. List down the types of duties in customs. An importer

Solve the following linear programming graphically, Problem based on graphi...

Problem based on graphical solution of a given LPP when feasible region is bounded. 1.    Solve the following linear programming graphically; Maximize and minimize z = 60x+

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