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# Table Information For Questions 1-5 Equipment Sub 100 Oiler J Texan Favorable Market (\$) 300,000 250,000 75,000 Unfavorable Market (%) -200,000

Part 1 of 3 - Part 1
This part of the question is based on the information from Problems 3-18 and 3-19 in the textbook.

Question 1 of 9 10.0 Points
If Bob would want to base his decision on the Maximin criterion, then which equipment would he choose?

A. Sub 100

B. Oiler J

C. Texan

D. The same as his brother Ken's choice
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Question 2 of 9 10.0 Points

Based on the information given in Problem 3-19 and the Table of Problem 3-17, the Expected Monetary Value (EMV) of Sub 100 is . (Please round to a whole dollar.)
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Question 3 of 9 10.0 Points

Based on the information given in Problem 3-19 and the Table of Problem 3-17, the Expected Monetary Value (EMV) of Oiler J is . (Please round to a whole dollar.)

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Question 4 of 9 10.0 Points
If Ken would want to maximize the Expected Monetary Value (EMV), then he should choose __________.

A. Sub 100

B. Oiler J

C. Texan
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Question 5 of 9 10.0 Points

If Ken believes that Sub 100 cannot get \$300,000 even in a favorable market, then this figure needs to be at least less for Ken to change his decision. (Please round to a whole dollar.)

Hint: You may want to use the What-If-Analysis Goal Seek Tool in Excel as described in Week 1 PPP Slides (1-30).
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Part 2 of 3 - Part 2
This part of the question is based on the information from Problem 3-26 in the textbook.

Question 6 of 9 10.0 Points

The Expected Monetary Value (EMV) of producing 6 cases of cheese spread is . (Please round to a whole dollar.)

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Question 7 of 9 10.0 Points

The Expected Monetary Value (EMV) of producing 9 cases of cheese spread is . (Please round to a whole dollar.)

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Question 8 of 9 10.0 Points
John should manufacture _________ cases of cheese spread.

A. 6

B. 7

C. 8

D. 9
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Part 3 of 3 - Part 3
This part of the question is based on the information from Problem 3-34 in the textbook.

Question 9 of 9 20.0 Points

Construct a decision tree by fill-in the blanks below in reference to the following chart.

The decision choice at Decision 1 is and that at Decision 2 is Event 1 is and Event 2 is .

The probability for Prob1 is and that for Prob2 is .

Payoff 1 is and Payoff 2 is .

EMV 1 is and EMV 2 is .

Table Information For Questions 1-5 Equipment Favorable Market (\$) Unfavorable Market (%) Sub 100 300,000 -200,000 Oiler J 250,000 -100,000 Texan 75,000 -18,000 Question 1 of 9 This part of the question is based on the information from Problems 3-18 and 3-19 in the textbook. If Bob would want to base his decision on the Maximin criterion, then which equipment would he choose? A. Sub 100 B. Oiler J C. Texan Question 2 of 9 Based on the information given in Problem 3-19 and the Table of Problem 3-17, the Expected Monetary Value (EMV) of Sub 100 is ____. (Please round to a whole dollar.) Question 3 of 9 Based on the information given in Problem 3-19 and the Table of Problem 3-17, the Expected Monetary Value (EMV) of Oiler J is _____. (Please round to a whole dollar.) Question 4 of 9 If Ken would want to maximize the Expected Monetary Value (EMV), then he should choose __________. A. Sub 100 B. Oiler J C. Texan Question 5 of 9
If Ken believes that Sub 100 cannot get \$300,000 even in a favorable market, then this figure needs to be at least _______ less for Ken to change his decision. (Please round to a whole dollar.) Information for Questions 6-9 3-26 Megley Cheese Company is a small manufacturer of several different cheese products. One of the products is a cheese spread that is sold to retail outlets. Jason Megley must decide how many cases of cheese spread to manufacture each month. The probability that the demand will be six cases is 0.1, for 7 cases is 0.3, for 8 cases is 0.5, and for 9 cases is 0.1. The cost of every case is \$45, and the price that Jason gets for each case is \$95. Unfortunately, any cases not sold by the end of the month are of no value, due to spoilage. How many cases of cheese should Jason manufacture each month? Question 6 of 9 The Expected Monetary Value (EMV) of producing 6 cases of cheese spread is _____. (Please round to a whole dollar.) Question 7 of 9 The Expected Monetary Value (EMV) of producing 9 cases of cheese spread is ____. (Please round to a whole dollar.) Question 8 of 9 John should manufacture _________ cases of cheese spread. A. 6 B. 7 C. 8 D. 9 Question 9 of 9
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The solution is... View the full answer

SOLUTION:
1. C
We find the maximin by step 1: finding the minimum corresponding to each
alternative and then step 2: finding for which alternative the maximum occurs out of
the minimums found in...

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