A company sells its products to wholesalers in batches of 1,000 units only. The daily demand for its product and the respective probabilities are given below. Demand (Units) Probability 0 0.1 1000 0.3 2000 0.4 3000 0.1 4000 0.1 a. Determine the expected daily demand. b. Assume that the company sells its product at $3.90 per unit. What is the expected daily revenue?
Q: In model review context, this objective involves the documentation of aspects of the model, without ...
A: In a model review context, the objective that would involve the documentation of the aspects of the ...
Q: The number of pizzas ordered on Friday evenings between 5:30 and 6:30 at a pizza delivery location f...
A:
Q: nere t for M
A: Predicted demands
Q: While it is true that increased efficiency leads to increased productivity, it is also possible to f...
A: To be determined: While it is true that increased efficiency leads to increased productivity, it is ...
Q: Rock View Restaurant is a new fast-food restaurant chain. The Operations Manager has divided its nor...
A: Formulae: To estimate the efficiency of the new design process by: Efficiency = Total Task time Ac...
Q: Using a Trend Line The demand for Year Demand electrical power 1997 60 at N.Y.Edison over the years ...
A: Given-
Q: 2. Compute the multifactor productivity measure for each of the weeks shown for production of chocol...
A: Productivity is the ability to the measurement of output production effectively and efficiently usin...
Q: How do we incorporate probability into inventory decisions?
A: Probability & Inventory: Just knowing that it might occur does not really mean it's inevitable. ...
Q: Which of the following is true? Select one: a. Comparing with test marketing, the data and informati...
A: Test marketing can be defined as a methodology that explores the consumer responses to a particular ...
Q: 4) If the range of profitable demand for a company producing digital pumps was D'1 = 8.5 units and D...
A:
Q: Q.4: What is Condition based maintenance? How it can be future of facility management. Explain with ...
A: Condition based maintenance is a strategy in maintenance which would monitor the actual condition of...
Q: Calculate the CPM and the floats
A: In this question, I would construct the CPM network diagram, here, for each activity ID, I would det...
Q: Investigate the approach that Cisco Systems has used in its many successful acquisitions. What are s...
A: From the given case stuyd, it is evident that Cisco has been acquiring businesses that prove to be b...
Q: briefly explain the difference between planning and scheduling
A: Thorough production planning and optimum utilization of the resources are the primary goals of plann...
Q: Titebond blends Methanol and Toluene to produce two types of wood glues. Glue 1 must be at least 70%...
A: Here, I have considered that all glue produced could be sold, as per the question I would formulate ...
Q: The Station estimates demand for the semester will be 620 dozen cinnamon mait ball cookles. Due to t...
A: Break-even is the point in a business where the profits are equal to the costs.
Q: tegories, each of wh
A: In a "Production System," an input is transformed into the desired output via the use of a process a...
Q: Define chase strategy.
A: Inventory is the raw material, work-in-process material and finished products that are used for manu...
Q: Destination the way of organisations that how they manage the supply chain in a more effective way.
A: The cornerstone of supply chains includes people, processes, technology, and information, which conn...
Q: 4) If the range of profitable demand for a company producing digital pumps was D'1 = 8.5 units and D...
A:
Q: Kent State University students services department is concerned about the lack of healthy food optio...
A: given, 650 bar per week allocate 3workers for 7.5 hr each
Q: Let us assume that a new medical facility, Health-care, is to be located in XYZ city. The location f...
A: The above table can be redrawn as, Sr Location factor Factor rating Location 1 Location 2 1 Fa...
Q: A process that is within specifications 99.9997% of the time is called: A 2-Sigma process A 4-Sigma ...
A: Quality is the ability to manufacture the products and services as set standards and increase custom...
Q: Which of the following statements is / are not a strategic operations management decision. I. Determ...
A: In strategic Operations Management, the objective is to achieve profitability effectively and effici...
Q: Supervisor Kenneth Peterson wants to determine the percent of time a machine in his area is idle. He...
A: The detailed solution is given in Step 2.
Q: The fire department has a number of failures with itsoxygen masks and is evaluating the possibility ...
A:
Q: business models. NO COPY PASTE FROM INTERNET, WRITE IT IN YOUR OWN WO
A: An airline may be described as a corporation that delivers regular services for moving people or car...
Q: Florist Gump manufactures flower pots. Each pot sells for $40. The variable costs associated with ea...
A: Breakeven point(BEP) is the unit of item or total value of revenue which covers the total cost of th...
Q: 3. What is the importance of human resource planning?
A: Human resource planning can be referred to the strategic processes focused on evaluating the present...
Q: Compute the weighted average forecast using the following weights: 0.20, 0.30, 0.10, and 0.40
A:
Q: BOBO Van is a start-up company which develops an app to receive orders from customers and provide de...
A: Given- Arrival Rate λ = 6020= 3 orders per hourService Rate μ = 6015= 4 orders per hour
Q: Contracts will have specific steps for a grievance procedure; however, the basic framework includes ...
A: A grievance is an employee's dissatisfaction with the company's work regulations and circumstances a...
Q: Which virtual problems are the most serious for virtual projects? Why? Which virtual problems might ...
A: A Virtual project under which group or team members are distributed geographically & potentially...
Q: Consider the following work breakdown structure: Time Estimates (days) Most Likely Activity Precedes...
A: project completion can be defined as a time between the date financial assistance is awarded and the...
Q: The number of bushels of apples sold at a roadside fruit stand over a 12-day period were as follows:...
A: A moving average is a measurement that catches the average change in an information series over the ...
Q: Explain, using an example, how the replacement of a component could have unintended repercussions an...
A: According to the question , we have to explain, using an example, how the replacement of a componen...
Q: For the past 10 quarters, House Depot, Inc. has generated sales data for 2x2 (in board feet) and the...
A: Linear regression is a forecasting model which identify the forecasting value based on the considera...
Q: National Co. has developed a new production process to manufacture its product. The new process is c...
A: Given data is Learning curve = 70% Time taken by first unit = 100 hours
Q: BIG produces four types of yogurts A, B, C, and D. Each box of yogurt carries protein, sugar, and Fa...
A: As mentioned in the question, the company wants to minimize the production cost. Hence, it is a mini...
Q: Two plants supply three customers with medical supplies. The unit costs of shipping from the plants ...
A: Given data is
Q: A furniture manufacturer produces two types of tables – country and contemporary – using three types...
A: Objective Functions and Constraints: Based on the given details, the objective funct...
Q: Dunder Mifflin, of Scranton, PA, is the leading manufacturer of office furniture and related items. ...
A: At its center, market segmentation is the act of partitioning your objective market into receptive g...
Q: Question 3 (Forecasting) - Consider the following time series data. Week 1 2 3 4 5 6. Value 18 13 16...
A: Given data: *As per guideline first 3 parts are answerable, repost the remaining part.
Q: 8-1 (Production problem) Winkler Furniture manufactures two different types of china cabinets: a Fre...
A: Let the number of French Provincial cabinets produced be F and Danish Modern cabinets be D. The Net ...
Q: What is the expected sales for the 7th week based on 3 period moving average. What is the forecast f...
A: Forecasting is the process of predicting the future demand using previous or historic information.
Q: * 12.17 Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. Th...
A: Economic order quantity is a computation that businesses use to determine their optimal order size, ...
Q: Use the process flow diagram below for an assembly line. Station C Station A Station B Station D Hou...
A: A process flow diagram helps to identify the flow of a process through developing the activities and...
Q: True or False? "Market researchers always prefer to use secondary data because secondary data is che...
A: Secondary data can be considered as the data which has been already collected and is available form ...
Q: It Is the concept that can be applied to both products and services. a. logistics b. supply chain ...
A: a. logistics:- Logistics is only related to the delivery of goods or movements of finished products....
Q: The utilization of machine 1 is about: A) 15% B) 19% 25% (D 55%
A: An utilization of the station indicating the proportion between total available time and actual prod...
A company sells its products to wholesalers in batches of 1,000 units only. The daily demand for its product and the respective probabilities are given below.
Demand (Units) |
Probability |
0 |
0.1 |
1000 |
0.3 |
2000 |
0.4 |
3000 |
0.1 |
4000 |
0.1 |
a. | Determine the expected daily demand. |
b. | Assume that the company sells its product at $3.90 per unit. What is the expected daily revenue? |
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 5 images
- Assume the demand for a companys drug Wozac during the current year is 50,000, and assume demand will grow at 5% a year. If the company builds a plant that can produce x units of Wozac per year, it will cost 16x. Each unit of Wozac is sold for 3. Each unit of Wozac produced incurs a variable production cost of 0.20. It costs 0.40 per year to operate a unit of capacity. Determine how large a Wozac plant the company should build to maximize its expected profit over the next 10 years.W. L. Brown, a direct marketer of womens clothing, must determine how many telephone operators to schedule during each part of the day. W. L. Brown estimates that the number of phone calls received each hour of a typical eight-hour shift can be described by the probability distribution in the file P10_33.xlsx. Each operator can handle 15 calls per hour and costs the company 20 per hour. Each phone call that is not handled is assumed to cost the company 6 in lost profit. Considering the options of employing 6, 8, 10, 12, 14, or 16 operators, use simulation to determine the number of operators that minimizes the expected hourly cost (labor costs plus lost profits).A common decision is whether a company should buy equipment and produce a product in house or outsource production to another company. If sales volume is high enough, then by producing in house, the savings on unit costs will cover the fixed cost of the equipment. Suppose a company must make such a decision for a four-year time horizon, given the following data. Use simulation to estimate the probability that producing in house is better than outsourcing. If the company outsources production, it will have to purchase the product from the manufacturer for 25 per unit. This unit cost will remain constant for the next four years. The company will sell the product for 42 per unit. This price will remain constant for the next four years. If the company produces the product in house, it must buy a 500,000 machine that is depreciated on a straight-line basis over four years, and its cost of production will be 9 per unit. This unit cost will remain constant for the next four years. The demand in year 1 has a worst case of 10,000 units, a most likely case of 14,000 units, and a best case of 16,000 units. The average annual growth in demand for years 2-4 has a worst case of 7%, a most likely case of 15%, and a best case of 20%. Whatever this annual growth is, it will be the same in each of the years. The tax rate is 35%. Cash flows are discounted at 8% per year.
- Play Things is developing a new Lady Gaga doll. The company has made the following assumptions: The doll will sell for a random number of years from 1 to 10. Each of these 10 possibilities is equally likely. At the beginning of year 1, the potential market for the doll is two million. The potential market grows by an average of 4% per year. The company is 95% sure that the growth in the potential market during any year will be between 2.5% and 5.5%. It uses a normal distribution to model this. The company believes its share of the potential market during year 1 will be at worst 30%, most likely 50%, and at best 60%. It uses a triangular distribution to model this. The variable cost of producing a doll during year 1 has a triangular distribution with parameters 15, 17, and 20. The current selling price is 45. Each year, the variable cost of producing the doll will increase by an amount that is triangularly distributed with parameters 2.5%, 3%, and 3.5%. You can assume that once this change is generated, it will be the same for each year. You can also assume that the company will change its selling price by the same percentage each year. The fixed cost of developing the doll (which is incurred right away, at time 0) has a triangular distribution with parameters 5 million, 7.5 million, and 12 million. Right now there is one competitor in the market. During each year that begins with four or fewer competitors, there is a 25% chance that a new competitor will enter the market. Year t sales (for t 1) are determined as follows. Suppose that at the end of year t 1, n competitors are present (including Play Things). Then during year t, a fraction 0.9 0.1n of the company's loyal customers (last year's purchasers) will buy a doll from Play Things this year, and a fraction 0.2 0.04n of customers currently in the market ho did not purchase a doll last year will purchase a doll from Play Things this year. Adding these two provides the mean sales for this year. Then the actual sales this year is normally distributed with this mean and standard deviation equal to 7.5% of the mean. a. Use @RISK to estimate the expected NPV of this project. b. Use the percentiles in @ RISKs output to find an interval such that you are 95% certain that the companys actual NPV will be within this interval.If a monopolist produces q units, she can charge 400 4q dollars per unit. The variable cost is 60 per unit. a. How can the monopolist maximize her profit? b. If the monopolist must pay a sales tax of 5% of the selling price per unit, will she increase or decrease production (relative to the situation with no sales tax)? c. Continuing part b, use SolverTable to see how a change in the sales tax affects the optimal solution. Let the sales tax vary from 0% to 8% in increments of 0.5%.The Tinkan Company produces one-pound cans for the Canadian salmon industry. Each year the salmon spawn during a 24-hour period and must be canned immediately. Tinkan has the following agreement with the salmon industry. The company can deliver as many cans as it chooses. Then the salmon are caught. For each can by which Tinkan falls short of the salmon industrys needs, the company pays the industry a 2 penalty. Cans cost Tinkan 1 to produce and are sold by Tinkan for 2 per can. If any cans are left over, they are returned to Tinkan and the company reimburses the industry 2 for each extra can. These extra cans are put in storage for next year. Each year a can is held in storage, a carrying cost equal to 20% of the cans production cost is incurred. It is well known that the number of salmon harvested during a year is strongly related to the number of salmon harvested the previous year. In fact, using past data, Tinkan estimates that the harvest size in year t, Ht (measured in the number of cans required), is related to the harvest size in the previous year, Ht1, by the equation Ht = Ht1et where et is normally distributed with mean 1.02 and standard deviation 0.10. Tinkan plans to use the following production strategy. For some value of x, it produces enough cans at the beginning of year t to bring its inventory up to x+Ht, where Ht is the predicted harvest size in year t. Then it delivers these cans to the salmon industry. For example, if it uses x = 100,000, the predicted harvest size is 500,000 cans, and 80,000 cans are already in inventory, then Tinkan produces and delivers 520,000 cans. Given that the harvest size for the previous year was 550,000 cans, use simulation to help Tinkan develop a production strategy that maximizes its expected profit over the next 20 years. Assume that the company begins year 1 with an initial inventory of 300,000 cans.
- Lemingtons is trying to determine how many Jean Hudson dresses to order for the spring season. Demand for the dresses is assumed to follow a normal distribution with mean 400 and standard deviation 100. The contract between Jean Hudson and Lemingtons works as follows. At the beginning of the season, Lemingtons reserves x units of capacity. Lemingtons must take delivery for at least 0.8x dresses and can, if desired, take delivery on up to x dresses. Each dress sells for 160 and Hudson charges 50 per dress. If Lemingtons does not take delivery on all x dresses, it owes Hudson a 5 penalty for each unit of reserved capacity that is unused. For example, if Lemingtons orders 450 dresses and demand is for 400 dresses, Lemingtons will receive 400 dresses and owe Jean 400(50) + 50(5). How many units of capacity should Lemingtons reserve to maximize its expected profit?You now have 10,000, all of which is invested in a sports team. Each year there is a 60% chance that the value of the team will increase by 60% and a 40% chance that the value of the team will decrease by 60%. Estimate the mean and median value of your investment after 50 years. Explain the large difference between the estimated mean and median.A new edition of a very popular textbook will be published a year from now. The publisher currently has 1000 copies on hand and is deciding whether to do another printing before the new edition comes out. The publisher estimates that demand for the book during the next year is governed by the probability distribution in the file P10_31.xlsx. A production run incurs a fixed cost of 15,000 plus a variable cost of 20 per book printed. Books are sold for 190 per book. Any demand that cannot be met incurs a penalty cost of 30 per book, due to loss of goodwill. Up to 1000 of any leftover books can be sold to Barnes and Noble for 45 per book. The publisher is interested in maximizing expected profit. The following print-run sizes are under consideration: 0 (no production run) to 16,000 in increments of 2000. What decision would you recommend? Use simulation with 1000 replications. For your optimal decision, the publisher can be 90% certain that the actual profit associated with remaining sales of the current edition will be between what two values?
- The DC Cisco office is trying to predict the revenue it will generate next week. Ten deals may close next week. The probability of each deal closing and data on the possible size of each deal (in millions of dollars) are listed in the file P11_55.xlsx. Use simulation to estimate total revenue. Based on the simulation, the company can be 95% certain that its total revenue will be between what two numbers?Suppose we are considering the question of how much capacity to build in the face of uncertain demand. Assume that the cost is $20 per unit of lost sales due to insufficient capacity. Also assume that there is a cost of $7 for each unit of capacity built. The probability of various demand levels is as follows: Demand—X Units Probability of X 0 .05 1 .10 2 .15 3 .20 4 .20 5 .15 6 .10 7 .05 a. How many units of capacity should be built to minimize the total cost of providing capacity plus lost sales? b. State a…Hemmingway, Inc., is considering a $5 million research and development (R&D) project. Profit projections appear promising, but Hemmingway's president is concerned because the probability that the R&D project will be successful is only 0.50. Furthermore, the president knows that even if the project is successful, it will require that the company build a new production facility at a cost of $20 million in order to manufacture the product. If the facility is built, uncertainty remains about the demand and thus uncertainty about the profit that will be realized. Another option is that if the R&D project is successful, the company could sell the rights to the product for an estimated $25 million. Under this option, the company would not build the $20 million production facility. The decision tree is shown in Figure 4.16. The profit projection for each outcome is shown at the end of the branches. For example, the revenue projection for the high demand outcome is $59 million.…