Please help me answer this, I need it in an hour. Complete solutions. Thank you. 3. The Miramar Company is going to introduce one of three new products: a widget,a hummer, or a nimnot. The market conditions (favorable, stable, or unfavorable)will determine the profit or loss the company realizes, as shown in the followingpayoff table:Market ConditionsFavorableStableUnfavorableProduct.2.7.1Widget$120,000$70,000$-30,000Hummer60,00040,00020,000Nimnot35,00030,00030,000a. Compute the expected value for each decision and select the best one.b. Develop the opportunity loss table and compute the expected opportunity loss foreach product.c. Determine how much the firm would be willing to pay to a market research firm togain better information about future market conditions.d. The Miramar Company is considering contracting with a market research firm to do asurvey to determine future market conditions. The results of the survey will indicateeither positive or negative market conditions. There is a 0.60 probability of a positivereport, given favorable conditions; a O.30 probability of a positive report, given stableconditions; and a 0.10 probability of a positive report, given unfavorable conditions.There is a 0.90 probability of a negative report, given unfavorable conditions; a 0.70probability, given stable conditions; and a 0.40 probability, given favorableconditions. Using decision tree analysis and posterior probability tables, determinethe decision strategy the company should follow, the expected value of the strategy,and the maximum amount the company should pay the market research firm for thesurvey results.

Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

3. The Miramar Company is going to introduce one of three new products: a widget, a hummer, or a nimnot. The market conditions (favorable, stable, or unfavorable) will determine the profit or loss the company realizes, as shown in the following payoff table: Market Conditions Favorable Stable Unfavorable Product .2 .7 .1 Widget $120,000 $70,000 $-30,000 Hummer 60,000 40,000 20,000 Nimnot 35,000 30,000 30,000 a. Compute the expected value for each decision and select the best one. b. Develop the opportunity loss table and compute the expected opportunity loss for each product. c. Determine how much the firm would be willing to pay to a market research firm to gain better information about future market conditions.

3. The Miramar Company is going to introduce one of three new products: a widget, a hummer, or a nimnot. The market conditions (favorable, stable, or unfavorable) will determine the profit or loss the company realizes, as shown in the following payoff table: Market Conditions Favorable Stable Unfavorable Product .2 .7 .1 Widget $120,000 $70,000 $-30,000 Hummer 60,000 40,000 20,000 Nimnot 35,000 30,000 30,000 a. Compute the expected value for each decision and select the best one. b. Develop the opportunity loss table and compute the expected opportunity loss for each product. c. Determine how much the firm would be willing to pay to a market research firm to gain better information about future market conditions.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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