Mastura has a small frozen food business. She prepares semi-cooked, frozen foods like popiah, samosa and pau to be sold to retail outlets throughout Perak. Recently, she is deciding to add a new line of product to her existing ones. Each alternative product line requires her to purchase a special machine to prepare the foods. How well she sells this new product depends on the price of seafood this year. Below is the payoff table Mastura has prepared showing her revenue per month. Calculate the expected value and advice Mastura which equipment will give her the most projected revenue. Seafood Prices Stable 0.50 RM 11,800 RM 9,750 RM 10,730 Increase Reduce Equipment Slab Mixer Yule Grinder Mini Mill 0.25 0.25 RM 2,200 RM 3,100 RM 1,900 RM 15,200 RM 17,400 RM 12 960
Mastura has a small frozen food business. She prepares semi-cooked, frozen foods like popiah, samosa and pau to be sold to retail outlets throughout Perak. Recently, she is deciding to add a new line of product to her existing ones. Each alternative product line requires her to purchase a special machine to prepare the foods. How well she sells this new product depends on the price of seafood this year. Below is the payoff table Mastura has prepared showing her revenue per month. Calculate the expected value and advice Mastura which equipment will give her the most projected revenue. Seafood Prices Stable 0.50 RM 11,800 RM 9,750 RM 10,730 Increase Reduce Equipment Slab Mixer Yule Grinder Mini Mill 0.25 0.25 RM 2,200 RM 3,100 RM 1,900 RM 15,200 RM 17,400 RM 12 960
Chapter16: Tax Research
Section: Chapter Questions
Problem 64DNC
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Question
![Mastura has a small frozen food business. She prepares semi-cooked, frozen foods
like popiah, samosa and pau to be sold to retail outlets throughout Perak. Recently,
she is deciding to add a new line of product to her existing ones. Each alternative
product line requires her to purchase a special machine to prepare the foods. How
well she sells this new product depends on the price of seafood this year. Below is
the payoff table Mastura has prepared showing her revenue per month. Calculate the
expected value and advice Mastura which equipment will give her the most projected
revenue.
Seafood Prices
Stable
Reduce
0.25
Increase
Equipment
Slab Mixer
Yule Grinder
Mini Mill
Mason Till
0.25
RM 2,200
RM 3,100
RM 1,900
RM 4,312
0.50
RM 11,800
RM 9,750
RM 10,730
RM 8,490
RM 15,200
RM 17,400
RM 12,960
RM 13,910
2.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F17070c9a-b757-4ea3-8afc-b3a32f7c593e%2F9afd98a7-5f4c-4313-8646-62018d601706%2F74lq15_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Mastura has a small frozen food business. She prepares semi-cooked, frozen foods
like popiah, samosa and pau to be sold to retail outlets throughout Perak. Recently,
she is deciding to add a new line of product to her existing ones. Each alternative
product line requires her to purchase a special machine to prepare the foods. How
well she sells this new product depends on the price of seafood this year. Below is
the payoff table Mastura has prepared showing her revenue per month. Calculate the
expected value and advice Mastura which equipment will give her the most projected
revenue.
Seafood Prices
Stable
Reduce
0.25
Increase
Equipment
Slab Mixer
Yule Grinder
Mini Mill
Mason Till
0.25
RM 2,200
RM 3,100
RM 1,900
RM 4,312
0.50
RM 11,800
RM 9,750
RM 10,730
RM 8,490
RM 15,200
RM 17,400
RM 12,960
RM 13,910
2.
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