What is the expected value of the revenue

Assignment Help Operation Management

Reference no: EM132293957

LSMU makes picture frames for fine art. Each frame generates revenue of $100. LSMU has estimated three possible levels of demand for frames in the coming year: there is a 50% chance the demand will be 600; a 30% chance the demand will be 800, and a 20% chance the demand will be 1,500. a) LSMU currently has a capacity of 900 frames per year that limits how many they can produce and sell. What is the expected value of the revenue for next year for LSMU? b) What capacity (in frames per year) for LSMU would be needed to make the expected value of revenue for next year be $80,000 for LSMU?

Reference no: EM132293957

Questions Cloud

Is auctioning the best way to eliminate unsold seats : Is auctioning the best way to eliminate unsold seats? Why or why not?

Balance of the politics-administration dichotomy important : Is maintaining a balance of the politics-administration dichotomy important? What does, or might, happen if there is not a proper balance?

Discuss the relationship between classes and objects : Discuss the relationship between classes and objects. Give a real-world analogy that depicts the relationship between classes and objects.

The first pirate in alphabetical order becomes the chief : Five pirates, called Ann, Brenda, Carla, Danielle and Emily, found a treasure of 100 gold coins. On their ship, they decide to split the coins using

What is the expected value of the revenue : What is the expected value of the revenue for next year for LSMU?

Describe the elements of solar geometry : Describe the elements of solar geometry so we can calculate the position of the Sun at any time of the day, at any location on Earth.

Faster and cheaper and the internet : As a computer becomes faster and cheaper and the Internet becomes more widely used

Create simple argument visualisation using MindMup software : In this assessment you will create a simple argument visualisation using MindMup software. Identify some logical arguments based on classical ethical theories

What are the major problems of whatsapp : What are the major problems of WhatsApp and what are the solution to fix them?

User Account

All Pages