QNT561_r9_Bell_Computer_Company_Case1_Week_.xlsx -...

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Medium-Scale Large-ScaleExpansion ProfitsExpansion ProfitsP(x)P(x)DemandLow5020%020%Medium15050%10050%High20030%30030%Expected Profit ($1000s)145140Risk Analysis for Medium-Scale ExpansionDemand(x - µ)Low5020%-9590251805Medium15050%52512.5High20030%553025907.52725σ = 52.201532545Risk Analysis for Large-Scale ExpansionDemand(x - µ)Low020%-140196003920Medium10050%-401600800High30030%16025600768012400σ =111.35528726Annual Profit ($1000s)Annual Profit ($1000s)Annual Profit (x)$1000sProbability P(x)(x - µ)2(x - µ)2* P(x)σ2=Annual Profit (x)$1000sProbability P(x)(x - µ)2(x - µ)2* P(x)σ2=The medium scale expansion would be preferred it has a lower

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