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

Calculate a profit and loss statement, Calculate a profit and loss statemen...

Calculate a profit and loss statement and balance sheet (including calculating a missing figure. Capital): Asset, liability, owner's equity, revenue and expense amounts for Almo

How reduce the safety stock, The annual demand for a product is 15,600 unit...

The annual demand for a product is 15,600 units. The weekly demand is 300 units with a standard deviation of 90 units. The cost to place an order is $31.20, and the time from order

Explain how the government can implement information plan, Propose a plan f...

Propose a plan for how the government can implement information security plans to ensure its critical information is safe and protect.

Travel chart, #questionI want some project of travel chart ..

#questionI want some project of travel chart ..

What does mean owns real estate in fee simple absolute, If someone owns rea...

If someone owns real estate in fee simple absolute, what does that mean?

Explain how would you prevent them from occurring again, There are many way...

There are many ways in which someone can gain access to employee data. Share some of those ways and how you would address them after the fact. How would you prevent them from occur

Memorandum, location analysis on expanding manufacturing plant

location analysis on expanding manufacturing plant

What are the advantages as well disadvantages for a u.s, What are the advan...

What are the advantages and disadvantages for a U.S.-based company entering a mature market economy?

Explain why is mis one of the most important courses, Why is MIS one of the...

Why is MIS one of the most important courses for a business student?

Explain generally speaking and work packages, Generally speaking, work pack...

Generally speaking, work packages: Answer Are assigned to one functional unit Are not assigned to one functional unit Must be assigned to two or more functional units

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