Question
In: Statistics and Probability
The following decision evaluation matrix provides the estimated dollar ($M) profit for five design alternatives and...
- The following decision evaluation matrix provides the estimated dollar ($M) profit for five design alternatives and four possible future levels of sales for a new product.
Levels of Sales
Design Options F1 F2 F3 F4
ALT-1 15 11 12 9
ALT-2 7 9 12 20
ALT-3 8 8 14 17
ALT-4 17 5 5 5
ALT-5 6 14 8 9
A) Which Design Alternative would be chosen with the Laplace criterion rule?
B) Which Design Alternative would be chosen with the Maximin criterion rule?
C) Which Design Alternative would be chosen with the Maximax criterion rule?
D) Which Design Alternative would you recommend and why?
Solutions
orchestra answered 2 years agoRelated Solutions
The following payoff table shows profit for a decision analysis problem with two decision alternatives and...
The following payoff table shows profit for a decision analysis
problem with two decision alternatives and three states of
nature.
Decision
Alternative
States of Nature
s1
s2
s3
d1
240
90
15
d2
90
90
65
Suppose that the decision maker obtained the probabilities
P(s1) = 0.65,
P(s2) = 0.15,
and
P(s3) = 0.20.
Use the expected value approach to determine the optimal
decision.
EV(d1) = EV(d2) = The
optimal decision is ? d₁ d₂
The five steps of the consumer buying process are: problem recognition, information search, evaluation of alternatives,...
The five steps of the consumer buying process are: problem
recognition, information search, evaluation of alternatives,
purchase decision, and post purchase evaluation. Think of a large
purchase you‘ve recently made. Did you follow the steps of the
consumer buying process when deciding? Evaluate each step and
discuss whether you passed through each step or stage during your
purchase decision. If you did not, which steps were skipped and
why?
Explain how to develop and use an External Factor Evaluation (EFE) Matrix. Discuss the five steps...
Explain how to develop and use an External Factor
Evaluation (EFE) Matrix.
Discuss the five steps needed to develop an EFE
Matrix.
Three mutually exclusive design alternatives are beimg considered. The estimated cah flows for each alternative are...
Three mutually exclusive design alternatives are beimg
considered. The estimated cah flows for each alternative are given
below. The MARR is 20% per year. At the conclusion of the useful
life, the investment will be sold. A decision-maker can select one
of these alternatives or decide to select none of them. Make a
recommendation using the PW method. Which alternative would you
select?
Three mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are...
Three mutually exclusive design alternatives are being
considered. The estimated cash flows for each alternative are given
below. The MARR is 12% per year. At the end of the useful life,
the investment will be sold. A decision-maker can select one of
these alternatives or decide to select none of them. Make a
recommendation using the PW method.
X
Y
Z
Investment cost
$275,000
$140,000
$370,000
Annual revenue
$85,840
$53,207
$93,911
Annual cost
$23,183
$14,370
$20,543
Useful life
15 years...
Two mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are...
Two mutually exclusive design alternatives are being considered.
The estimated cash flows for each alternative are given below. The
MARR is 10% per year. A decision maker must select one of these
alternatives.
A B
Investment cost $50,000 $30,000
Annual Revenue 15,000 10,000
Salvage value 5,000 3,000
Useful life (yrs.) 5 5
For all parts below, do not convert from another form of
equivalent worth; e.g., AW→FW. 1. Compute the AW for Alt A. Based
on this measure, should the...
Three mutually exclusive design alternatives are beimg considered. The estimated cah flows for each alternative are...
Three mutually exclusive design alternatives are beimg
considered. The estimated cah flows for each alternative are given
below. The MARR is 20% per year. At the conclusion of the useful
life, the investment will be sold. A decision-maker can select one
of these alternatives or decide to select none of them. Make a
recommendation using the PW method. Which alternative would you
select?
Five investment alternatives have the following returns and standard deviations of returns. Alternatives Returns: Expected...
Five investment alternatives have the following returns and
standard deviations of returns.
Alternatives
Returns:
Expected Value
Standard
Deviation
A
$
1,110
$
1,270
B
3,970
820
C
3,970
1,330
D
5,790
2,650
E
12,500
7,350
Calculate the coefficient of variation and rank the five
alternatives from lowest risk to the highest risk by using the
coefficient of variation. (Round your answers to 3 decimal
places.)
Which of the following is a disadvantage of the matrix design? Resource utilization is...
Which of the following is a disadvantage of the matrix design?
Resource utilization is inefficient.
Decision making is decentralized.
A single head has to overlook multiple divisions.
There is low flexibility.
Additional time is required for meetings and coordination.
In the following matrix for the profits of two pizza firms with the decision whether or...
In the following matrix for the profits of two pizza firms with
the decision whether or not to offer “free delivery” what is the
dominant outcome. Use the check mark system to explain why.
You deliver
You don’t deliver
Rival delivers
Rival gets $3000
You get $3000
Rival gets $5000
You get $4000
Rival doesn’t deliver
Rival gets $4000
You get
$5000
Rival gets $6000
You get $6000
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