Kenneth Brown is the principal owner of Brown Oil, Inc. After quitting his university teaching job. Ken has been able to increase his annual salary by a factor of over 100. At the present time. Ken is forced to consider purchasing some more equipment for Brown Oil because of competition. His alternatives are shown in the following table: Equipment Favorable UnfavorableMarket Market$ $Sub 100 300,000 -200,000Oiler J 250,000 -100,000Texan 75,000 – 18,000For example, if Ken purchase a Sub 100 and if there is a favorable market, he will realize a profit of $300,000. On the other hand, if the market is unfavorable, Ken will suffer a loss of $200,000. But Ken has always been a very optimistic decision maker.a. What type of decision is Ken facing?b. What decision criterion should he use?c. What alternative is best?The Lubricnat is an expensive oil newsletter to which many oil giants subscribe, including Ken Brown (see the above problem for details). In the last issue, the letter described how the demand for oil products would be extremely high. Apparently, the American consumer will continue to use oil products even if the price of these products doubles.Indeed, one of the articles in the Lubricant states that the chance of a favorable market for oil products was 70%, while the chance of an unfavorable market was only 30%. Ken would like to use these probabilities in determining the best decision.a. What decision model should be used?b. What is the optimal decision?c. Ken believes that the $300,000 figure for the Sub 100 with a favorable market is too high. How much lower would this figure have to be for Ken to change his decision made in part B?Today’s Electronics specializes in manfactoring modern electronic components. It also builds the equipment that produces the components. Phyllis Weinberger, who is responsible for advising the president of Today’s Electronics on electronic manufacturing equipment , has developed the following table concerning a proposed facility:PROFIT ($)STRONG FAIR POORLarge facility 550,000 110,000 -110,000Meduim-sizedfacility 300,000 129,000 -100,000No facility 0 0 0a. Develop an opportunity loss table.b. What is the minimax regret decision?Megley Cheese Company is a small manufacturer of several defferent cheese products. One of the products is a 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 $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?
Kenneth Brown is the principal owner of Brown oil inc, after quitting his university teaching job,ken has been able to increase his annual salary by a factor of over 100. at the present time, ken…
They have a magnificent team. These people are always kind and willing to listen to your concerns or issues. Better yet, your assignment is always ready before the time, they usually send you a draft to double-check before they finalize your paper.
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more