Operations Management: Sustainability And Supply Chain Management Custom Edition For Temple University, Version 3
11th Edition
ISBN: 9781269383578
Author: HEIZER
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter A, Problem 18P
Summary Introduction
To construct: A decision tree.
Introduction:
Decision tree:
A decision tree can be termed as map of all the possible outcomes that can arise from the series of related choices. It will allow an individual or an organization to weigh their outcomes in different bases of costs, probabilities and the benefits.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Monica Britt has enjoyed sailing small boats since she was 7 years old, when her mother started sailing with her. Today, Monica is considering the possibility of starting a company to produce small sailboats for the recreational market. Unlike other mass-produced sailboats, however, these boats will be made specifically for children between the ages of 10 and 15. The boats will be of the highest quality and extremely stable, and the sail size will be reduced to prevent problems of capsizing.
Her basic decision is whether to build a large manufacturing facility, a small manufacturing facility, or no facility at all. With a favourable market, Monica can expect to make R90,000 from the large facility or R60,000 from the smaller facility. If the market is unfavourable, however, Monica estimates that she would lose R30,000 with a large facility and she would lose only R20,000 with the small facility.
Because of the expense involved in developing the initial moulds and acquiring the…
A group of developers is opening a health club near a new housing development. The health club—which will have exercise and workout equipment, basketball courts, swimming pools, an indoor walking/running track, and tennis courts—is one of the amenities thedevelopers are building to attract new homebuyers. However, they want the health club to at least break even the first year or two. The annual fixed cost for the building, equipment, utilities, staff, and so on is $875,000, and annual variable costs are $200 per member for things like water, towels, laundry, soap, shampoo, and other member services. The membership fee is $225 per month. How many members will the club need to break even? If the club doubles its break-even membership after a year, what will its profit be?
Please create an objective true using these two solutions.
Solution1 - More accommodation/residence should be built in the airport itself as it would allow Pascal to save a lot of time consumed while reaching the airport from his house. He would stay in the built-in residence only during his workdays and in his house on the weekend. It will also allow many passengers to stay if their flights get postponed/canceled due to any reason.
Solution 2 - If a prayer room/area is built in the airport itself, it will allow Rajput and other diverse travelers and people who work in the airport to complete their prayer in its proper time. Rajput could complete that specific prayer between the time after he checks in his luggage and the boarding time.
PLEASE FOLLOW THESE REQUIRMENTS ASWELL OTHERWISE QUESTION WILL BE MARKED INCOMPLETE:
Three levels of objectives are included. At the 1st-level, three or more objectives are included. Each 1st-level objective is broken into two or more 2nd-level…
Chapter A Solutions
Operations Management: Sustainability And Supply Chain Management Custom Edition For Temple University, Version 3
Ch. A - Prob. 1DQCh. A - Prob. 2DQCh. A - Prob. 3DQCh. A - Prob. 4DQCh. A - Prob. 5DQCh. A - Question: 6. Explain how decision trees might be...Ch. A - Prob. 7DQCh. A - Prob. 8DQCh. A - Question 9. Identify the five steps in analyzing a...Ch. A - Prob. 10DQ
Ch. A - Question 11. The expected value criterion is...Ch. A - Question 12. When are decision trees most useful?Ch. A - Given the following conditional value table,...Ch. A - Prob. 2PCh. A - Prob. 3PCh. A - Jeffrey Helm owns a health and fitness center...Ch. A - Prob. 5PCh. A - Prob. 6PCh. A - Prob. 7PCh. A - Prob. 8PCh. A - Prob. 9PCh. A - Prob. 10PCh. A - The University of Miami bookstore stocks textbooks...Ch. A - Palmer Jam Company is a small manufacturer of...Ch. A - Prob. 13PCh. A - Prob. 14PCh. A - Prob. 15PCh. A - Prob. 16PCh. A - Prob. 17PCh. A - Prob. 18PCh. A - Prob. 19PCh. A - Philip Musa can build either a large video rental...Ch. A - Prob. 21PCh. A - Prob. 22PCh. A - Prob. 23PCh. A - Question A.24 On the opening page of Module A and...Ch. A - Question Warehouse Tenting at the Port of Miami...Ch. A - Question Warehouse Tenting at the Port of Miami...Ch. A - Question Warehouse Tenting at the Port of Miami...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Similar questions
- As the project manager you have been asked by AstraZeneca to assess the viability of two (2) subprojects based on their net present value (NPV). Based on the information below which project would be selected and why? Projects 1 has an initial investment of $50,000 and a net cash inflow of $27,000 for a period of 2 years. Project 2 has an initial investment of $150,000 and a net cash inflow of $59,000 in year 1 and $120,000 in year 2. The discount rate to be used is 5%arrow_forwardMarla Opper currently earns $53,000 a year and is offered a job in another city for $66,700. The city she would move to has 23 percent higher living expenses than her current city. What minimum salary should Marla require before accepting the new position? Should Marla accept the new job?arrow_forwardJames Lawson’s Bed and Breakfast, in a small his-toric Mississippi town, must decide how to subdivide (remodel) the large old home that will become its inn. There are threealternatives: Option A would modernize all baths and combinerooms, leaving the inn with four suites, each suitable for two tofour adults. Option B would modernize only the second floor; theresults would be six suites, four for two to four adults, two fortwo adults only. Option C (the status quo option) leaves all wallsintact. In this case, there are eight rooms available, but only twoare suitable for four adults, and four rooms will not have privatebaths. Below are the details of profit and demand patterns thatwill accompany each option: ANNUAL PROFIT UNDERVARIOUS DEMAND PATTERNSALTERNATIVES HIGH P AVERAGE PA (modernize all) $90,000 .5 $25,000 .5B (modernize 2nd) $80,000 .4 $70,000 .6C (status quo) $60,000 .3 $55,000 .7Which option has the highest expected monetary value?arrow_forward
- A payoff matrix has to be prepared with three alternative products Α1 , Α2 and Α3 . The respective cost costs of these products are K2, K2.50 and K4 per unit and their sale prices are K3, K4 and K5 per unit respectively. The normal production capacity of the plant for production of each of the products Α1 , Α2 and Α3 is 3,000, 2,000 and 1,000 units respectively. Showing all the working clearly, prepare the payoff table if the states of demand are high (S1 ) , moderate (S2 ) and low (S3 ) with respective demand levels of 3,000, 2,000 and 1, 000 units. The stocks unsold will be worth half the cost price for the next period. ii. What is the maximax decision? iii. What is the maximin decision? iv. What is equally likely decision? v. What is the criterion of realism decision? Use α = 0.8 vi. Develop an opportunity loss table and determine the minimax decision.arrow_forwardDescribe the bounds, limitations, requirements, proportional relationships, and balance constraints: Rosenberg Land Development (RLD) is a developer of condominium properties in the Southwest United States. RLD has recently acquired a 40.625-acre site outside Phoenix, Arizona. Zoning restrictions allow at most 8 units per acre. Three types of condominiums are planned: one-, two-, and three-bedroom units. The average construction costs for each type of unit are $450,000, $600,000, and $750,000, respectively. These units will generate a net profit of 10%. The company has equity and loans totaling $180 million dollars for this project. From prior development projects, senior managers have determined that there must be a minimum of 15% one-bedroom units, 25% two-bedroom units, and 25% three-bedroom units.arrow_forwardMaximize profit = 4X + 4Y Subject to: 3X +5Y ≤ 150 X – 2Y ≤ 10 5X + 3Y ≤ 150 X, Y ≥ 0 Required: a- The corner point method to obtain the optimal point. b- Specify the profit value. c- Calculate the Slack for each constraint and state its formula.arrow_forward
- Two brothers have purchased a small lot, in the center of town, where they intend to build a gas station. The station will have two pumps, a service area for water and tire maintenance, and a main building with restrooms, office, and cash register area. Before they begin excavating the site, the local authorities must approve the location for a gasoline station and be certain that the placement of the storage tanks will not interfere with water, gas, and electric lines that are already in place.Once the site has been approved, the excavation can begin. After excavation, the three primary parts of the construction can begin: laying in the gasoline tanks, building the water and tire service area (including installation of the air compressor), and constructing the main building. The surfacing can begin after all building is completed. After surfacing, the site must be cleaned and the station’s signs erected. However, before the station can open for business, the air compressor must be…arrow_forwardConsider the following two mutually exclusive investment projects: Assume that the MARR = 15%.(a) Using the NPW criterion, which project would you select?(b) On the same chart, sketch the PW(i) function for each alternative for i = 0% and 50%. For what range of i would you prefer Project B?arrow_forwardA payoff table is given as: S1 S2 S3 D1 250 750 500 D2 300 -250 1200 D3 500 500 600 (a) What choice should be made by the optimistic decision maker? (b) What choice should be made by the conservative decision maker? (c) What decision should be made under minimal regret? (d) If the probabilities of d1, d2, and d3 are .2, .5, and .3, respectively, then what choice should be made under expected value?arrow_forward
- Dave Escalona, a DLSL Computer Engineering graduate, is considering the possibility of opening a small computer shop at SM City Lipa, a few blocks from the school. His options are to open a small shop, a medium-sized shop or no shop at all. The market for the computer shop can be good, average or bad. The probabilities for these possibilities are 0.2 for good market, 0.5 for average market and 0.3 for bad market. The net profit or loss for the medium-sized or small shop for the various market conditions are given in the table below. Building no shop also yields no loss and no gain. What do you recommend? Good Market Average Market Bad Market Alternatives P P P Small shop 75,000 25,000 -40,000 Medium-sized shop 100,000 35,000 -60,000 No shop 0 0 0 Probabilities 0.2 0.5 0.3arrow_forwardThe Lotus Point Condo Project will contain both homes and apartments. The site can accommodate up to 10,000 dwelling units. The project must contain a recreation project: either a swimming-tennis complex or a sailboat marina, but not both. If a marina is built, then the number of homes in the project must be at least triple the number of apartments in the project. A marina will cost $1.2 million, and a swimming-tennis complex will cost $2.8 million. The developers believe that each apartment will yield revenues with a net present value of $48,000, and each home will yield revenues with a net present value of $46,000. Each home (or apartment) costs $40,000 to build. Formulate an integer program to help Lotus Point maximize profits.arrow_forwardA car company is planning the introduction of a new electric car. There are two options for production. One is to produce the electric car at the company’s existing plant in Illinois, sharing production with its other products that are currently being produced there. If the sales of the electric car are moderate, this will work out well as there is significant capacity to produce all of the products there. However, if sales of the electric car are strong, this option would necessitate Adding a 3rd shift, which would lead to significantly higher costs. Another option is to build a new plant in Ohio. The new plant would have sufficient capacity to meet whatever level of demand for the new car. However, if sales of the new car not strong, the plant would be underutilized and less efficient. Since this is a new product, sales are hard to predict. The forecast indicates there is a 60% chance of strong sales (annual sales of 100,000), and 40% chance of moderate sales (annual sales of…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,
Practical Management Science
Operations Management
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:Cengage,