Engineering Economy (17th Edition)
17th Edition
ISBN: 9780134870069
Author: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher: PEARSON
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Chapter 12, Problem 25P
To determine
Calculate the time period.
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You are at a casino and there are three slot machines you can use to bet on. You must have a
return of .5% of higher on what you are betting. Below is the expected returns for each slot
machine under various scenarios. What combination of machines do you play to maximize your
average return?
Decision Variables
Data
Slot 1
100.0%
Monday Tuesday
Wednesda Average
Slot 2
0.0%
Slot #1
8%
4%
5%
5.667%
Slot 3
0.0%
Slot #2
2%
-3%
3%
0.667%
Slot #3
6%
-2%
4%
2.667%
Objective
5.7%
Constraints
0.08 >=
0.5%
0.04 >=
0.5%
0.05 >=
0.5%
100.0% .:
100%
ABC Inc. must make a decision on its current capacity for next year. Estimated profits (in $000s) based on next year's
demand are shown in the table below.
Alternative
Expand
Subcontract
Do nothing
Refer to the information above. Assume that ABC Inc. has hired a marketing research firm that provided additional
information regarding next year's demand. Suppose that the probabilities of low and high demand are assessed as follows:
P(Low) = 0.4 and P(High) = 0.6.
What is the expected value under certainty?
160
0
Next Year's Demand
Low High
$100 $200
$50 $120
$40
$50
140
200
Problem 2: As a building designer, you have been asked to analyze and select the best
window frame type alternative-either aluminum or steel. The project is located in a remote
area, and the nearest industrial area hosting steel and aluminum windows frames
manufacturers is 250 km away. All project windows are identical, and the circumference of
the window frame is 6.2 meter. A crew of two labors is required to manufacture one steel
frame. It takes 2.5 hours to manufacture the first window every day, and the learning rate is
0.9. The number of production units is per day is limited to 8. The weight of steel is 12 kg per
meter, and the weight of aluminum is 4.5 kg per meter. The cost of steel is 0.4 OMR per kg
and the cost of aluminum 1.1 OMR per kg. If 45 windows frames are required for the project,
the crew cost is 3 OMR per hour for steel frames and 3.6 for aluminum frames, and the
transportation, price is 0.01 OMR per kg per 50 km, which alternative would you select?
Chapter 12 Solutions
Engineering Economy (17th Edition)
Ch. 12 - Prob. 1PCh. 12 - Prob. 2PCh. 12 - A new snow making machine utilizes technology that...Ch. 12 - Prob. 4PCh. 12 - Prob. 5PCh. 12 - Prob. 6PCh. 12 - Prob. 7PCh. 12 - Prob. 8PCh. 12 - Prob. 9PCh. 12 - Prob. 10P
Ch. 12 - Prob. 11PCh. 12 - Prob. 12PCh. 12 - Prob. 13PCh. 12 - Prob. 14PCh. 12 - Prob. 15PCh. 12 - Prob. 16PCh. 12 - Prob. 17PCh. 12 - Prob. 18PCh. 12 - Prob. 19PCh. 12 - Prob. 20PCh. 12 - Prob. 21PCh. 12 - Prob. 22PCh. 12 - If the interest rate is 8% per year, what decision...Ch. 12 - Prob. 24PCh. 12 - Prob. 25PCh. 12 - Prob. 26SE
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