PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP
PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP
6th Edition
ISBN: 9781337610278
Author: WINSTON
Publisher: CENGAGE L
Question
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Chapter 9, Problem 30P

a)

Summary Introduction

To identify: The decision that would minimize the expected cost using precision tree.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

a)

Expert Solution
Check Mark

Explanation of Solution

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  1

Formulae to determine the above table:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  2

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  3

b)

Summary Introduction

To determine: The input that have the largest effect on the best.

Introduction: Simulation model is the digital prototype of the physical model that helps to forecast the performance of the system or model in the real world.

b)

Expert Solution
Check Mark

Explanation of Solution

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  4

Formulae to determine the above table:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  5

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  6

Decision tree developed by precision tree software:

Decision tree should be developed using precision tree software.

Place the cursor at any blank cell and click decision tree under precision tree icon. The following window will appear:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  7

Press ok and the below image (Model image) will appear:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  8

Click in the triangle:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  9

Select decision (The below image is model):

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  10

Click ok and the below image (Model image) will appear:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  11

Click in the triangle:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  12

Select chance (The below image is model):

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  13

The process should be continued till end.

The following image shows the complete decision tree:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  14

According to decision tree, it is better to wait and purchase the sugar in six months.

Strategy B4:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  15

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  16

Strategy B5:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  17

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  18

Strategy B6:

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  19

PRACTICAL MGT. SCIENCE (LL)-W/MINDTAP, Chapter 9, Problem 30P , additional homework tip  20

The sensitivity analysis was done for the cells B4, B5, and B6. It is optimal to purchase a 10-ton futures contract.

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