Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (12th Edition)
12th Edition
ISBN: 9780134855424
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Textbook Question
Chapter 4, Problem 20P
Dawson Electronics is a manufacturer of high-tech control modules for lawn sprinkler systems. Denise, the CEO, is trying to decide if the company should develop one of the two potential new products, the Water Saver 1000 or the Greener Grass 5000. With each product, Dawson can capture a bigger market share if it chooses to expand capacity by buying additional machines. Given different demand scenarios, their probabilities of occurrence, and capacity expansion versus no change in capacity, the potential sales of each product are summarized in Table 4.5.
- What is the expected payoff for Water Saver 1000 and the Greener Grass 5000, with and without capacity expansion?
- Which product should Denise choose to produce, and with which capacity expansion option?
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Dawson Electronics is a manufacturer of high-tech control modules for lawn sprinkler systems. Denise, the CEO, is
trying to decide if the company should develop one of the two potential new products, the Water Saver 1000 or the
Greener Grass 5000. With each product, Dawson can capture a bigger market share if it chooses to expand capacity
by buying additional machines. Given different demand scenarios, their probabilities of occurrence, and capacity
expansion versus no change in capacity, the potential sale of each product are summarized in the included table.
Click the icon to view the table.
What is the expected payoff for the Water Saver 1000 and the Greener Grass 5000, with and without capacity
expansion?
The expected payoff for the Water Saver 1000 with the capacity expansion is $
integer.)
The expected payoff for the Water Saver 1000 without the capacity expansion is $. (Enter your response as an
integer.)
ਗਿਆ
(Enter your response as an
The expected payoff for the Greener Grass…
Edwards Machine Tools needs to purchase a new machine. The basic model is slower but costs less, while the advanced model is faster but costs more. Profitability will depend on future demand. The following table presents an estimate of profits over the next three years.
Decision
Low
Medium
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$125,000
Advanced Model
$70,000
$140,000
$240,000
Given the uncertainty associated with the demand volume and no other information to work with, how would you make a decision?
Use the Excel template Decision Analysis and explain your reasoning.
Muñoz Corporation's decision to produce a new line of recreational products resulted in the need to construct either a small plant or a large plant. The best selection of plant size depends on how the marketplace reacts to the new product
line. To conduct an analysis, marketing management has decided to view the possible long-run demand as low, medium, or high. The following payoff table shows the projected profit in millions of dollars.
Long-Run Demand
Plant Size Low
Medium High
Small
250
300
300
Large
150
300
600
(a) What is the decision to be made, and what is the chance event for Muñoz problem?
The decision is to choose the best plant size
. There are 2
alternatives. The chance event is the market demand for the new product line
There are 3
possible outcomes.
(b) Construct an influence diagram. (Submit a file with a maximum size of 1 MB.)
Choose File No file chosen
This answer has not been graded yet.
(c) Construct a decision tree. (Submit a file with a maximum size of 1 MB.)…
Chapter 4 Solutions
Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (12th Edition)
Ch. 4 - Prob. 1DQCh. 4 - Prob. 2DQCh. 4 - The Dahlia Medical Center has 30 labor rooms, 15...Ch. 4 - A process currently services an average of 50...Ch. 4 - An airline company must plan its fleet capacity...Ch. 4 - Food Goblin Supermarkets use both cashiers and...Ch. 4 - Returning to Problem 4, under both assumption of...Ch. 4 - Purple Swift manufactures birdhouses in lots of...Ch. 4 - Macon Controls produces three different types of...Ch. 4 - Up, Up, and Away is a producer of kites and wind...
Ch. 4 - Tuff-Rider, Inc. manufactures touring bikes and...Ch. 4 - Arabelle is considering expanding the floor area...Ch. 4 - The Astro World amusement park has the opportunity...Ch. 4 - Kim Epson operates a full-service car wash, which...Ch. 4 - MKM International is seeking to purchase a new CNC...Ch. 4 - Prob. 17PCh. 4 - Prob. 18PCh. 4 - Prob. 19PCh. 4 - Dawson Electronics is a manufacturer of high-tech...Ch. 4 - A manager is trying to decide whether to buy one...Ch. 4 - Acme Steel Fabricators experienced booming...Ch. 4 - Referring to Problem 7, the operations manager at...Ch. 4 - Darren Mack owns the Gas n’ Go convenience store...Ch. 4 - Prob. 25PCh. 4 - Prob. 1VCCh. 4 - Prob. 2VCCh. 4 - How does Southwest Airlines know they are...Ch. 4 - Prob. 4VCCh. 4 - Prob. 1CCh. 4 - Prob. 2CCh. 4 - Prob. 3C
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