Fundamentals of decision analysis

Assignment Help Operation Management

Reference no: EM132269215

Fundamentals of Decision Analysis

Project Funding

As the President of XYZ’s largest subsidiary, you have two project proposals on your desk. Note: All monetary values cited are in today’s U.S. dollars.

I. Last year, we approved Project I. Upon completion, it will generate $100 M in revenue, and cost $90M. You spent the $90M. The proposal before you now states that an additional $20M is required to complete the project and realize the $100M in revenue. If you do not spend the additional $20M, no revenues will be realized.

II. Project II will generate $80 M in revenue. A trusted advisor tells you that you can secure this deal at a cost of $20 MM.

Now consider the following questions:

a. If you had $100 MM to invest today, which project(s) would you fund?

b. If you had $20 MM to invest today, which project(s) would you fund?

c. If you had known from the start that there would be the additional $20MM required to complete Project I, would it still have deserved funding?

Reference no: EM132269215

Questions Cloud

Develop an incident response policy for abc company : The incident occurred in the application area that provides custom application development and reporting for the ABC Company.

Coca-cola is called global product : Coca-cola is called a global product. Does this mean that Coca-cola is formulated in the same way throughout the world? Discuss.

Describe the roles of a drp or ecp team : Identify who needs to be notified based on the type and severity of the incident. Outline how the incident could be contained.

Complete a nursing care plan for the video client : 401017 Promoting Mental Health And Wellbeing Assignment, Western Sydney University, Australia. Complete a nursing care plan for the video client

Fundamentals of decision analysis : Fundamentals of Decision Analysis

Explain how the cpi is measured : What are the common price indices we have? Explain how the CPI is measured?

What is inflation : What is inflation? It is the rate of change of general price level? A natural question to ask is "What is the general price level"?

Developing and implementing performance management plans : What needs to be considered when developing and implementing performance management plans

Potential rifle out of the market : This firm has market pricing power and is making a hefty economic profit but a potential rifle firm in the market could cause problems your job

User Account

All Pages