5) President Of Kim Manufacturing, Inc., Is Considering Whether Or Not To Build More Manufacturing Plants In Wisconsin. Her Decision Is Summarized In The Following Table ALTERNATIVES FAVORABLE ARKET UNFAVORABLE MARKET (S) Build Large Plant Build Small Plant 300,000 10,000 0 0.6 400,000 80,000 Don't Build Market Probabilities 0.4 A) What Is The Best Decision

 

 

volved in placing an onder, and he has concluded that the ing cost is estimated to be $2. The manager has made a the wester, which has an annual demand of 2,000 units. well indial valves and fluid control devices. One of cost ive from the supplier, and during this time the demand per of $20 per onder. Furthermont, it takes about three weeks alve is appsimately comic w 5) President of Kim Manufacturing, Inc., is considering whether or not to build more manufacturing plants in Wisconsin. Her decision is summarized in the following table. ALTERNATIVES Build Large Plant Build Small Plant Don't Build Market Probabilities FAVORABLE MARKET (S) 400,000 80,000 0 0.4 UNFAVORABLE MARKET (S) -300,000 -10,000 0 0.6 a) What is the best decision based on the Expected Monetary Value (EMV). b) Construct an opportunity loss table c) Determine EOL (Expected Opportunity Loss) and conclude the best alternative. d) Calculate the Expected Value of Perfect Information (EVPI) using the formula EVPI-EV(with)PI-PV(without)PI. Compaire your results with the value of EOLthat you have it from your answer in c).