Explain expected profit function to be maximized, Operation Management

Assignment Help:

A foundry receives an order for specialty castings. Cost of producing each casting is estimated to be $15,000. The customer requires that exactly 4 good castings be supplied. The customer will pay $20,000 for each good casting. If fewer than four good castings are available, none will be purchased. Each casting is produced independently and the probability of an individual casting being acceptable to the customer is .80. 1/ Develop the expected profit function to be maximized? 2/ Determine the production lot size that maximizes expected profit? 3/ Determine the lot size that will yield a probability of .90 of producing at least 4 good castings. What is the expected profit for the lot size obtained?


Related Discussions:- Explain expected profit function to be maximized

Process charts, Process Charts Process chart is the diagrammatic repr...

Process Charts Process chart is the diagrammatic representation of various tasks and activities in sequence of operation passing through the production process beginning with

Explain the three forms of ownership, Answer the following questions on the...

Answer the following questions on the Topic of Forms of Business Ownership 1. Describe the three forms of ownership. Describe two advantages and two disadvantages of each. 2.

Limitations of basic wage rate, What is the concept of comparative norm in ...

What is the concept of comparative norm in determining the basic wage rate? Why there are limitations to this approach? What has led companies to grant various forms of individual

Sub optimisation - operations function, Sub optimisation - Operations Funct...

Sub optimisation - Operations Function Another important issue raised by the systems approach is that of sub-optimisation. This is of considerable significance for managers, a

Explain what is the yield to maturity on this bond, Plasma TV Corporation b...

Plasma TV Corporation bonds are currently priced at $1,088. They have 12 years until maturity and a coupon rate of 6%. What is the yield to maturity on this bond?

Explain introduce to a newly rebuilt world trade center, What types of chan...

What types of changes would you introduce to a newly rebuilt World Trade Center?

Explain planning of the project, You have been appointed as a project manag...

You have been appointed as a project manager for a high dollar project for the private sector and you have been asked by your boss to identify the stakeholder groups and the indivi

Explain main parts of the operations planning control system, List and brie...

List and briefly discuss the five main parts of the operations planning control (OPC) system

Intermittent and continuous operations, Explain intermittent and continuous...

Explain intermittent and continuous operations. Under what type of situation it would be used in automobile industry?

Explain what is the total cost of this policy, Rocky Mountain Tire Center s...

Rocky Mountain Tire Center sells 20,000 go-cart tires per year. The ordering cost for each order is $40, and the holding cost is 20% of the purchase price of the tires per year. Th

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