Generate a decision tree to help expando, Operation Management

Assignment Help:

Expando, Inc., is considering the possibility of building an additional factory that would produce a new addition to its product line. The company is currently considering two options. The first is a small facility that it could build at a cost of $6 million. If demand for new products is low, the company expects to receive $10 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects $12 million in discounted revenues using the small facility. The second option is to build a large factory at a cost of $9 million. Were demand to be low, the company would expect $10 million in discounts revenues with the large plant. If demand is high the company estimates that the discounted revenues would be $14 million. In either case, the probability of demand being high is .40, and the probability of it being low is .60. Not constructing a new factory would result in no additional revenue being generated because the current factories cannot produce these new products. Construct a decision tree to help Expando make the best decision.


Related Discussions:- Generate a decision tree to help expando

Makw or to Buy ?, • ABC Ltd. is in the business of manufacturing one type o...

• ABC Ltd. is in the business of manufacturing one type of valves for last 3 years. • Their sales have grown from 10,000 to about 50,000 valves per month. • Now they are planning t

I have some charts that i need help to put it in excel, I have soem charts ...

I have soem charts that were done i word how do I gt them to you for someone to put in excel for me

Define what behavioural predictions might you make, What behavioural predic...

What behavioural predictions might you make if you know that an employee had an external locus of control? If an employee had a high need for achievement? If an employee had a low

Explain operations management definiton of logistics, Netflix would be an e...

Netflix would be an example of which of the following approaches to managing customer induced variation? Cost penalties Uncompromised reduction Classic reduction Classic accomm

Explain competitors can be inferred by demonstration, Security Services, In...

Security Services, Inc. and Redline Protectors were the two predominant providers of home alarm systems in the Dallas area. They had become the two big businesses after the smaller

Compute the average number of customers waiting at lhs, During busy periods...

During busy periods, a new customer walks into LHS every 15 mins. (with a standard deviation of 15 mins). At SHC, a customer walks in every hour (with a standard deviation of 1 hou

Explain important characteristics of the human service model, What are the ...

What are the 2 most important characteristics of the human service model?

Explain the local publix grocery has five regular lanes, The local Publix G...

The local Publix Grocery has five regular lanes and one express lane (12 items or less only). Based on a sampling study, it takes 11 minutes on the average for a customer to go thr

Explain introduction to optimum design, Why are there no solutions for Intr...

Why are there no solutions for Introduction to Optimum Design textbooks?

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