S.A., has decided to open a new factory to introduce its products in the French market. For thispurpose, it is considering the following possible locations: Barcelona, Pamplona, Lyon and Paris. Theestimated profits for the next 5 years for each alternative are shown in the following table (inthousands of euros) depending on the variation in demand.Calculate the optimal decision if it is estimated that the probability that demand increases by 20% is30%, that it increases by 10% is 40%, that it remains stable is 25% and that it decreases is 5%.IncreaseIncreaseDecreaseStableDEMANDdemand10%10%demand20%demanddemanddemandBarcelona15022016050Pamplona20023014020Lyon175250150-10Paris230215200-50

Find the Given details below: Given details: Demand Increase 20 % Demand Increase 10 % Demand…

Answered: S.A., has decided to open a new factory…

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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Sarah is a designer, but her passion is to paint. To pursue her passion Sarah would like to have an exhibition of her art work for a week. She contacts four landlords with a proposal of renting their places for a week and to her surprise all 4 accept the idea. Characteristics of each location are as follows: Sarah wants to know if people like her paintings enough to buy them. Decision objectives:1- Space not less than 600ft2.2- Location3- Decoration4- Facilities5- Overall budget including rent for one week not to exceed $300 Which store is Sarah going to choose for her art exhibition? Explain your chain of thoughts and the process.
In solving the given problem ,you may refer to the following payoff table: New bridge built No new bridge Alternative location A 1 14 for new warehouse B 2 10 C 4 6 1. Assume the payoffs represent profits. Determine the alternative that would be chosen under each of these decision criteria: A. Maximin B. Maximax C. Laplace 2. Using the information in the payoff table, develop a table of regrets, and then: A. Determine the alternative that would be chosen under minimax regret. B. Determine the expected value of perfect information using the regret table, assuming that the probability of a new bridge being built is 0.60. 3. Using the probabilities of 0.60 for a new bridge and 0.40 for no new bridge, compute the expected value for each alternative in the payoff table , and identify the alternative that would be selected under the expected-value approach. 4.…
The manager of a car soft drinks facility wants to expand its operations in the coming year. He wants to build a new facility to do so. There are three possible locations for this facility. The fixed and variable costs involved are given in the table below: Locations Costs A B C Fixed 500,000 600,000 800,000 Variable 40 30 20 i. Based on costs, over what range of units will location A be preferred?ii. Based on costs, over what range of units will location B be preferred?iii. Based on costs, over what range of units will location C be preferred?
Draw a Decision Tree on this Alternative Location for New Warehouse Problem indicating graphically the sequences of decision alternatives and states of nature that provide the six possible payoffs.
Western Plastic Surgery Associates is planning on opening a cosmetic plastic surgery center in Honolulu, San Francisco, or Seattle. There is a 60 percent chance that the demand for plastic surgery in the US will increase in the near future, a 25 percent chance that the number will remain the same, and a 15 percent chance that the number will decrease. The developer estimates that the following profits would result from the decision given each set of economic conditions. Location Increase (0.60) Same (0.25) Decrease (0.15) Honolulu San Francisco Seattle $1,102,000 $720,000 $800,000 $856,000 $640,000 $702,000 $502,000 $602,000 $220,000 a. Find the best decision using the following criteria: Maximax Maximin Laplace (Equal Likelihood) Minimax Regret The expected value (EMV) b. What is the Expected Value of Perfect Information (EVPI)
A manager must decide between two location alternatives, Boston and Chicago. Boston would have annual fixed costs of $70000, transportation costs of $60 per unit, and labor and material costs of $200 per unit. Chicago would have annual fixed costs of $90000, transportation costs of $40 per unit, and labor and material costs of $170 per unit. Revenue will be $300 per unit. 1. Which alternative would yeild the higher profit for an annual demand of 3000 units? 2. Would the two locations yeild the same profit at a certain volume? If so, at what volume would that be?
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The piece of land available is situated on the main road through the area and has great views of MountKinabalu on one side and the valley below on the other side. As the strategic advisor you have been asked to come up with a recommendation whether to develop a 4-star or 5-star property. Due to the fact that the area is near a World Heritage site and due to building height restrictions the total number of rooms for a 4-star hotel would be 300 rooms, whilst for a 5-star property the number of rooms would be 190. Identify at least THREE (3) strengths and weaknesses each and at least TWO (2) opportunities and threats each for the proposed hotel/resort at that area. (Not for Mount Kinabalu as a tourist attraction!)
Sap Manufacturing, a manufacturing company that manufactures football jerseys and located in Port Antonio, Jamaica, is preparing to build a new plant. J’s is considering three potential locations that are suitable for the construction of the plant. The fixed and variable costs for the three alternative locations are presented in the table below. Costs A B C Fixed Costs ($) 700,000 1,000,000 1,100,000 Variable ($ per unit) 28 20 18 Identify the range over which each alternative (A, B and C) is best. A manufacturing firm is considering three potential locations for a new parts manufacturing facility. A consulting firm has assessed three sites based on the four factors supplied by management as critical to the location's success. The factor weights and the consultant team scores are given in table 5 below. Scores are based on 50 = best. Locations Factors Weights A B C Labor Climate 10 35 45 20 Taxes 30 30 40 40 Utilities 20 25 20…
Shoeless Joe is a specialty retailer that is deciding where tolocate a new facility. Th e annual fi xed and variable costs for eachpossible site have been estimated as follows: If demand is expected to be 2000 units, which location is best?
2. Cami-Clothes Cleaners is a dry cleaning business that is considering four possible sites for its new operation. The annual fixed and variable costs for each site have been estimated as follows: Fixed Costs $350,000 $170,000 $100,000 $250,000 Variable Costs $5/Unit $25/Unit $40/Unit $20/Unit Location A B C D a. If demand is expected to be 10,000 units per year, which is the best location?
The Zhao family of Atlanta, Georgia, is planning its annual summer vacation. Three vacation locations along with criteria weights and location ratings follow. What is the recommended vacation location? Criteria Travel distance Vacation Entertainment available Outdoor activities Unique experience Family fun O Myrtle Beach, South Carolina OSmoky Mountains Branson, Missouri Weight 2 5 3 2 4 5 Myrtle Beach, South Carolina 5 5 7 9 5 8 Ratings Smoky Mountains 9 6 4 6 9 9 Branson, Missouri 3 8 4 5 9 8

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