MacDonald Products, Inc., of Clarkson, New York, has the option of (a) proceeding immediately with production of a new top-of-the-line stereo TV that has just completed prototype testing or (b) having the value analysis team complete a study. If Tyrone Martin, VP for operations, proceeds with the existing prototype (option a), the firm can expect sales to be 90,000 units at $590 each, with a probability of 0.71 and a 0.29 probability of 75,000 at $590. If, however, he uses the value analysis team (option b), the firm expects sales of 85,000 units at $740, with a probability of 0.73 and a 0.27 probability of 65,000 units at $740. Value engineering, at a cost of $115,000, is only used in option b. Which option has the highest expected monetary value (EMV)? The EMV for option a is $ and the EMV for option b is $ monetary value. (Enter your responses as integers.) Therefore, option has the highest expected

An insurance company found that 2.4% of male drivers between the ages of 18 and 25 are involved in serious accidents annually. To simplify the analysis, assume that every such accident costs the insurance company $62,000 and that a driver can only have one of these accidents in a year. Complete parts (a) through (c). (a) If the company charges $2,600 for such coverage, what is the chance that it loses money on a single policy? P(loses money)= .024 (Type an integer or a decimal.) (b) Suppose that the company writes 1,000 such policies to a collection of drivers. What is the probability that the company makes a profit on these policies? Assume that the drivers don't run into each other and behave independently. P(profit) = .976 (Round to five decimal places as needed.)

The owner of a small firm has just purchased a personal computer, which she expects will serve her for the next two years. The owner has been told that she "must buy a surge suppressor to provide protection for her new hardware against possible surges or variations in the electrical current, which have the capacity to damage the computer. The amount of damage to the computer depends on the strength of the surge. It has been estimated that there is a 3% chance of incurring 450 dollar damage, 4% chance of incurring 250 dollar damage, and 15% chance of 75 dollar damage. An inexpensive suppressor, which would provide protection for only one surge, can be purchased. How much should the owner be willing to pay if she makes decisions on the basis of expected value? Expected Value =

An online retailer specializing in custom dog toys is considering launching brick-and-mortar stores in Upstate South Carolina. They have an opportunity to open a spot on Woodruff Road in Greenville, South Carolina next month at an upfront cost of $50,000. They believe this location has a 60% chance of success and a 40% chance of failure. If the location is successful, then it will bring the company a total of $350,000 in net profits over its lifetime. If the location is unsuccessful, then it will lose the company an additional $100,000. Complicating the Woodruff Road location decision is the fact that the company has identified an additional location in downtown Clemson. They do not need to decide on opening this additional location now; they need to decide in about 11 months whether to open it 12 months from now. The Clemson location has an upfront cost of $30,000. Without any additional information, the company believes it has a 70% of success and a 30% chance of failure. If…

The recent economic downturn resulted in the loss of jobs and an increase in delinquentloans for housing. In projecting where the real estate market was headed in the comingyear, economists studied the relationship between the jobless rate and the percentage ofdelinquent loans. The expectation was that if the jobless rate continued to increase, therewould also be an increase in the percentage of delinquent loans. The following data showthe jobless rate and the delinquent loan percentage for 27 major real estate markets. a. Compute the correlation coefficient. Is there a positive correlation between the joblessrate and the percentage of delinquent housing loans? What is your interpretation?b. Show a scatter diagram of the relationship between the jobless rate and the percentage

Techtronic is a company that provides electronic components for fighter aircraft. Techtronic plans to offer its newest product to an air military agency. The sales manager analyzes that there is a 60% chance that this agency will place an order. Based on previous experience, after the company has made a presentation, it is possible to be asked for a second presentation to higher officials. Based on historical data, it is known that of the companies that have succeeded in getting orders, 70% of them were asked for a second presentation. It is also known that of the companies that failed to get orders, 50% of them were asked for a second presentation. If Tectronic is asked for a second presentation, what is the probability that the company will get an order?   NEED IN RUSH THANKS

The owner of a small firm has just purchased a personal computer, which she expects will serve her for the next two years. The owner has been told that she "must" buy a surge suppressor to provide protection for her new hardware against possible surges or variations in the electrical current, which have the capacity to damage the computer. The amount of damage to the computer depends on the strength of the surge. It has been estimated that there is a 1% chance of incurring 300 dollar damage, 4% chance of incurring 100 dollar damage, and 15% chance of incurring 150 dollar damage from a surge within the next two years. An inexpensive suppressor, which would provide protection for only one surge, can be purchased. How much should the owner be willing to pay if she makes decisions on the basis of expected value? Expected value =

Avicenna, a major insurance company, offers five-year life insurance policies to 65-year-olds. If the holder of one of these policies dies before the age of 70, the company must pay out $27,400 to the beneficiary of the policy. Executives at Avicenna are considering offering these policies for $765 each. Suppose that for each holder of a policy there is a 3% chance that they will die before the age of 70 and a 97% chance they will live to the age of 70. If the executives at Avicenna know that they will sell many of these policies, should they expect to make or lose money from offering them? How much? To answer, take into account the price of the policy and the expected value of the amount paid out to the beneficiary. Avicenna can expect to make money from offering these policies. In the long run, they should expect to make dollars on each policy sold. O Avicenna can expect to lose money from offering these policies. In the long run, they should expect to lose dollars on each policy…

In a certain California city, projections for the next year are that there is a 20% chance that electronics jobs will increase by 200, a 50% chance that they will increase by 300, and a 30% chance they will decrease by 800. What is the expected change in the number of electronics jobs in that city in the next year?

Based on data, an insurance company estimates that a particular customer from a certain group has a 3.9% likelihood of having an accident in the next year, with the average insurance payout being $1500. The company charges each customer from this group an annual premium of $150. Complete the following table for one insurance policy from the company's point of view. The customer has an accident in the next year. The customer does not have an accident in the next year. S S S Money Probability What is the company's expected value of this insurance policy? If applicable, round your answer to the nearest cent.