You will address a Decision Analysis problem as described below using the tools discussed in class, and make a recommendation to the decision maker. In this problem, you will notice that “the chance that the antidumping tax will be imposed is p, where p is derived from the third and eighth digits of your student number”. To find the p to use in your submission,work as follows: • Let s3 and s8 be the third and eighth digits, respectively, of your student number. For example, if your student number is 21209459, then s3 = 2 and s8 = 9. • If s3 ≤ 3, then set s3 := s3 + 3. F
1. You will address a Decision Analysis problem as described below using the tools discussed in class, and make a recommendation to the decision maker. In this problem, you will notice that “the chance that the antidumping tax will be imposed is p, where p is derived from the third and eighth digits of your student number”. To find the p to use in your submission,work as follows:
• Let s3 and s8 be the third and eighth digits, respectively, of your student number. For example, if your student number is 21209459, then s3 = 2 and s8 = 9.
• If s3 ≤ 3, then set s3 := s3 + 3. For example, if s3 = 2, then set s3 to 5.
• If s3 ≥ 8, then set s3 := s3 − 2. For example, if s3 = 9, then set s3 to 7.
• Let p = 0.s3s8 as a decimal number. For example, if s3 = 5 and s8 = 9, then you would
get p = 0.59.
AAA Electronics has contracted to supply half a million TabletPC systems to CostCo
Stores in 90 days at a fixed price. Each TabletPC system requires a High Speed Northbridge chip (“HSN chip”) in order to
Any chips that AAA does not buy from CAC will be bought from Recce. Recce will sell HSN chips to AAA for S$3.00 per chip in any quantity. CAC will accept orders only in multiples of 250,000 HSN chips, and is offering to sell the chips for S$2.00 per chip for 250,000 chips,and for S$1.50 per chip in quantities of 500,000 or more chips.
However, the situation is complicated by a dumping charge that has been filed by Recce against CAC. If this charge is upheld by the Singapore government, then the CAC chips will be
subject to an antidumping tax. The judgement in this case will be delivered exactly two weeks
from now and, if the charge is upheld, the antidumping tax will go into effect immediately.
If AAA buys the CAC chips, these will not be shipped until 30 days from now, meaning the
chips would be subject to the tax if the charge is upheld. Under the terms proposed by CAC,
AAA would have to pay any antidumping tax that is imposed.
AAA believes that the chance that the antidumping tax will be imposed is p, where p is
derived from the third and eighth digits of your student number as described above. If it is
imposed, then it is equally likely that the tax will be 50%, 100%, or 200% of the sale price for
each HSN chip.
(i) Draw a decision tree for this decision.
(ii) Using
Step by step
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