Packs of strings should the guitar shop purchase

Assignment Help Operation Management
Reference no: EM131344866

Boutique Guitars and Gear carries several types of strings. For one type, each package of strings costs the store $3.50 to purchase, and the store can sell them for $6.50 a piece. He estimates that not having the strings in stock if someone wants them costs him about $0.50 in business goodwill. However, after 6 months the strings start to age and he has to drop the prices to $2.50 per pack to get them to sell. He estimates demand for the strings in the next 6 months using the table below. Generate a payoff table, and compute the expected value for each alternative. How many packs of strings should the guitar shop purchase?

Demand            Probability

10                           0.10

11                           0.15

12                           0.35

13                           0.25

14                           0.15

Reference no: EM131344866

Questions Cloud

Calculate the best options using maximax : Calculate the best options using maximax, maximin, and equal likelihood criteria (ignoring the probabilities), and then calculate the expected value for each situation. Which choice should the airport make?
Create a payoff table and a decision tree for situation : Create a payoff table and a decision tree for this situation. Calculate the best options using maximax, maximin, and equal likelihood criteria (ignoring the probabilities), and then calculate the expected value for each situation. Which choice sho..
Find the inductor current : The switch in given Figure has been in position A for a long time and is moved to position B at t = 0. At t = 100 μs the switch returns to position A. Find iL(t) for t ≥ 0.
What is the role of the central bank : What is the role of the central bank and commercial banks in the process of money multiplication? What do you think happens to the money multiplier in a financial crisis (like the one we had in year 2008), and why
Packs of strings should the guitar shop purchase : Generate a payoff table, and compute the expected value for each alternative. How many packs of strings should the guitar shop purchase?
Why prohabition was important in wi : what prohibition was with a small paragrah about why prohabition was important in wi and how its shaped today?
Focus of an organization efforts : It may not necessarily be OSHA or EPA, it could be another agency. Along with this, what compliance efforts do you foresee as being the focus of an organization's efforts in this industry and why?
Identify primary salient public issue face coca-cola company : Identify five stakeholders of The Coca-Cola Company (TCCC) in this case and what each of their interests is. Identify the primary salient public issue facing The Coca-Cola Company in this case and why?
Define what is meant by environmental law : Define what is meant by environmental law and describe how these laws are established, adopted, and altered. Suggest an organizational strategy, based on environmental compliance principles suggested in your text reading, which can be used to compl..

Reviews

Write a Review

Operation Management Questions & Answers

  Book review - the goal

Operations Management is about a book review. Title of the book is "Goal". This book has been written by Dr. Eliyahu Goldartt. The book has been appreciated by many as one of those books which offers an insight into the operations and strategic capac..

  Operational plan in hospitality enterprise

Operational plan pertaining to a hospitality enterprise is given in detail in the solution. The operational plan is an important plan or preparation which gives guidelines regarding the role and responsibilities of each and every operation at all lev..

  Managing operations and information

Recognise the importance of a strategic approach to the development and deployment of organisational information systems. Demonstrate an understanding of the importance of databases and their integration to the organisation's overall information mana..

  A make-or-buy analysis

An analysis of the holding costs, including the appropriate annual holding cost rate.

  Evolution and contributor of operations management

Briefly explain Evolution and contributor of Operations management.

  Functions and responsibilities of an operations manager

A number of drivers of change have transformed the roles, functions and responsibilities of an operations manager over recent years. These drivers have not only been based on technological innovations but also on the need for organisations to develop..

  Compute the optimal order quantity

Compute the Optimal Order quantity of DVD players. Determine the appropriate reorder point.

  Relationship to operations practice in the organisation

Evaluate problems in operations and identify approaches to overcoming them. Critically evaluate operating plans and identify areas for improvement. Justify, implement and evaluate changes to operations in line with modern approaches.

  A make or buy analysis

Develop a report for Figi Fabricating that will address the question of whether the company should continue to purchase the part from the supplier or begin to produce the part itself.

  Prepare a staffing plan

Prepare a staffing plan showing the change of your unit from medical/surgical staffing to oncology staffing.

  Leadership styles in different organizations

Ccompare the effectiveness of different leadership styles in different organizations

  Risk management tools and models

Be able to understand the concept of risk, roles and responsibilities for risk management and risk management tools and models.

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