Answer the following questions based on the Tornado and Sensitivity graphs given below. Which input variables are the most and the least impactful variables? Please mention two for each case. How the objective function changes by changing the most impactful input variable?
Answer the following questions based on the Tornado and Sensitivity graphs given below. Which input variables are the most and the least impactful variables? Please mention two for each case. How the objective function changes by changing the most impactful input variable?
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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Answer the following questions based on the Tornado and Sensitivity graphs given below.
- Which input variables are the most and the least impactful variables? Please mention two for each case.
- How the objective function changes by changing the most impactful input variable?
![Gross Sales (87)
Fixed Costs (B15)
Prob of Winning Case (86)
Variable Costs (816)
Prob(Mtg Process Works) (B5) Precision Tree Textbook Version
For Academic Use Only
Legal Fees (810)
Interest Rate (B11)
PI Stock Price (B12)
$1,500,000
$2,000,000
$2,500,000
000'000'ES
Expected Value
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F14cfc7b5-264f-452b-86ea-0d8259d28265%2Fd99333bb-15c1-4b55-83fd-da68419d1436%2Fmdvleic_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Gross Sales (87)
Fixed Costs (B15)
Prob of Winning Case (86)
Variable Costs (816)
Prob(Mtg Process Works) (B5) Precision Tree Textbook Version
For Academic Use Only
Legal Fees (810)
Interest Rate (B11)
PI Stock Price (B12)
$1,500,000
$2,000,000
$2,500,000
000'000'ES
Expected Value
$3,500,000
$4,000,000
$4,500,000
$5,000,000
$5,500,000
![Expected Value
Expected Value
$5,500,000
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$4,800,000
$4,600,000
$4,400,000
$4,200,000
$4,000,000
$3,800,000
$3,600,000
$3,400,000
$3,200,000
$3,000,000
$2,800,000
$20,000,000
%St
$25,000,000
Ⓡ
Expected Value Node 'Decision' (825)
With Variation of Gross Sales (B7)
Precision Tree Textbook Version
For Academic Use Only
$30,000,000
$35,000,000
Gross Sales (87)
$40,000,000
Expected Value of Node 'Decision' (825)
With Variation of Prob of Winning Case (86)
Precision Tree Textbook Version
For Academic Use Only
Prob of Winning Case (B6)
$45,000,000
75%-
000'000'oss
Expected Value
Expect
$5,500,000
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$3,556,001
$3,556,000
$3,556,000
$3,556,000
$3,556,000
$3,556,000
$3,555,999
$47
$1,000,000
$48
000'000'z$
Expected Value of Node 'Decision' (825)
With Variation of Fixed Costs (B15)
Precision Tree Textbook Version
For Academic Use Only
$3,000,000
$4,000,000
$5,000,000-
Fixed Costs (815)
Expected Value of Node 'Decision' (825)
With Variation of PI Stock Price (B12)
$6,000,000
PI Stock Price (B12)
Precision Tree Textbook Version
For Academic Use Only
- ESS
$7,000,000
554
$55
$8,000,000
$9,000,000
55](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F14cfc7b5-264f-452b-86ea-0d8259d28265%2Fd99333bb-15c1-4b55-83fd-da68419d1436%2F2v383p_processed.png&w=3840&q=75)
Transcribed Image Text:Expected Value
Expected Value
$5,500,000
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$4,800,000
$4,600,000
$4,400,000
$4,200,000
$4,000,000
$3,800,000
$3,600,000
$3,400,000
$3,200,000
$3,000,000
$2,800,000
$20,000,000
%St
$25,000,000
Ⓡ
Expected Value Node 'Decision' (825)
With Variation of Gross Sales (B7)
Precision Tree Textbook Version
For Academic Use Only
$30,000,000
$35,000,000
Gross Sales (87)
$40,000,000
Expected Value of Node 'Decision' (825)
With Variation of Prob of Winning Case (86)
Precision Tree Textbook Version
For Academic Use Only
Prob of Winning Case (B6)
$45,000,000
75%-
000'000'oss
Expected Value
Expect
$5,500,000
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$3,556,001
$3,556,000
$3,556,000
$3,556,000
$3,556,000
$3,556,000
$3,555,999
$47
$1,000,000
$48
000'000'z$
Expected Value of Node 'Decision' (825)
With Variation of Fixed Costs (B15)
Precision Tree Textbook Version
For Academic Use Only
$3,000,000
$4,000,000
$5,000,000-
Fixed Costs (815)
Expected Value of Node 'Decision' (825)
With Variation of PI Stock Price (B12)
$6,000,000
PI Stock Price (B12)
Precision Tree Textbook Version
For Academic Use Only
- ESS
$7,000,000
554
$55
$8,000,000
$9,000,000
55
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