3. The research department of the Allied Manufacturing Company has developed a new process that it believes will result in an improved product. Management must decide whether or not to go ahead and market the new product. The new product may be better than the old or it may not be better. If the new product is better and the company decides to market it, sales should increase by $120,000. If it is not better and they replace the old product with the new product on the market, they will lose $50,000 to competitors. If they decide not to market the new product they will lose $30,000 if it is better, and research costs of $20,000 if it is not. (a) Prepare a payoff matrix. (b) If management believes the probability that the new product is better to be .3, find the expected profits under each strategy and determine the best action.
Unitary Method
The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.
Speed, Time, and Distance
Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 miles away.
Profit and Loss
The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.
Units and Measurements
Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experiments to set up the devices.
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