Question

M2b: Normal Distribution Using the Z Formula Scenario Assignment

Scenario Script:

Caption: Princes Foods Corporation is going through their annual labor negotiation with their unionized employees. Bonnie and Liwei are doing their due diligence and would like to know how a strike at Princess Foods Corporation would negatively affect the number of cans of creamed peas produced per day if the workforce is not at full capacity.

Bonnie: Let’s think through the worst-case scenario: there’s a strike and we don’t have our normal workforce. What do we do?

Liwei: Before or after I have a heart attack?

Bonnie: Ha! Let’s say you have a heart attack on Friday and recuperate over the weekend. You come into work on Monday and we’ve shifted to our contingency plan.

Liwei: Okay, right. We would have management and other non-unionized employees in place to operate the machinery.

Caption: Use the data below and apply the principles of normal distribution using the z formula in order to determine the probability of units produced per day at Princess Foods Corporation.

Assignment

The average number of cans of creamed peas produced each day at the processing plant is 30,000 with a standard deviation of 3,200. Assuming a normal distribution, answer the following questions:

1. What is the probability of producing more than 36,000 cans per day?
2. What is the probability of producing between 25,000 and 38,000 cans per day?
3. What is the probability of producing between 32,000 and 34,000 cans per day?

Response must be in Memo format:

Remember to write your memo in a concise but yet informative manner.  Keep in mind that the memo will be read by a very busy manager who needs to see your recommendation up front and then be able to view details as needed.  The example below is from a management science exercise.  

Some tips for writing business memos:

• Memos should be written in third person. Do not use “I,” “we,” or “me.”

• There is no need to repeat the salutation or signature line. This is redundant of the memo heading.

• Memos should be concise and short. State the recommendation and justification. Formulas and

specifics should be in the addendum.

Purpose for Writing a Memo

The primary purpose of a memo is to support decision making—to help (or sometimes influence) a decision-maker to make a better decision in a particular problem situation than he or she might otherwise have made without the analysis. Other purposes that the memo can serve include: conveying information; informing decisions, making a request, providing a response to a question, making a suggestion, presenting an informal report, proposing a solution to a problem, or documenting a reference for future use.

Structure of a Memo

As the communication mechanism of the analysis process, the memo should provide a coherent synopsis of the problem, identify different options for addressing the problem, articulate opposing perspectives, and advocate for a recommended option. The typical structure for a memo includes: a description of the objective; relevant background information; a discussion of key considerations (including implementation concerns, financial considerations, stakeholder impacts, and possible unanticipated consequences), a summary of arguments for and against, and a recommended decision.

EXAMPLE:

TO:                 Mr. John Smith

FROM:           B Robeson

DATE:            January 12, 2016

SUBJECT:    Labor negotiation recommendation

It is recommended that the employees be offered a 10% salary increase and to bid $22 per unit on the project to manufacturer private labelled hair dryers for Target. This decision should maximize the expected profit at  $121,524 per year.

A decision tree approach was used to evaluate the best course of action.  Only two alternatives were considered for a raise, either non raise of 10%.  Also bids of $20, $21, and $22 were considered.  The information provided such as the probabilities of winning the contracts under the various bids and the probability of a strike and length of strike were taken into consideration.

Please see the attached decision tree and calculations for your review.  

To: Recipients’ names and job titles

From: Writers’ names and job titles

Date: Complete and current date

Subject: Description of what memo is about

Memo Requirements

Begin with a brief introductory paragraph that contextualizes the memo for your readers and describes the main point or course of action that readers should take after reading the memo. The introduction should not have a heading.

After the introductory paragraph, the body of the memo should be broken into sections with informative headings at the start of each section. These headings should not consist of generic words like "Problem" but specific phrases like "Avoiding Cost Overruns in Sector 7."

Remember that if there are others who will receive copies of memo, aside from the recipients, add cc: after the memo subject line with the names of those individuals.

Appendix: Supportive Documentation – Formulas and Calculations

Appendix Requirements

In the second page of the memo, please include supportive data and calculations to provide evidence of how you solved the problem. You can insert an Excel spreadsheet and a picture of handwritten calculations.

Attach supportive data and calculations on the second page of this memo.

Answer 1

Dear It's so lengthy. But yet I not skipped it, since I liked to help you...

So I provided answers for assignment question with detailed hand written Solution...

Answers

1) 0.0304 (3.04%)

2) 0.9347 (93.47%)

3) 0.1603 (16.03%)