Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Can you assist with creating a decision table? I am a little stuck! 1.I am the business owner that specializes in Chicago Styled Deep-Dish Pizza

Can you assist with creating a decision table? I am a little stuck!

1.I am the business owner that specializes in "Chicago Styled Deep-Dish Pizza" here in New Jersey. Business has been great and has allowed me to consider expanding the business to different areas of New Jersey.

2.3 Alternatives would be:

Expanding to have 2 more locations

Expanding to have 1 more location

No expansion and just continue business as such

3.3 States of Nature would be:

Great demand for Pizza

Modest demand for Pizza

No demand for Pizza

Currently, when business is great, the restaurant can expect to make about $500 daily. Staffing is $200 daily. We will have a net income of $300.

When business is modest, the restaurant can expect to make about $300 daily. Staffing is $200 daily. We will have a net income of $100.

When business is poor, the restaurant can expect to make about $100 daily. Staffing is $200 daily. We will have a net loss of -$100.

G = great demand; M= modest demand; P= poor demand

However, note that it is stated in the scenario that business has been great, so you can fix one data point of the combination as G. The possible cases in the scenario of we take one state as great are in bold format wile the other possibilities are in regular format:

Expanding to 2 more locations

Meaning there would be three branches in total, which could be of the following state combinations:

GGG: $900 net income

GGM: $700 net income

GGP: $500 net income

GMM: $500 net income

GMP: $300 net income

GPP: $100 net income

MMM: $300 net income

MMP:$100 net income

MPP: -$100 net loss

PPP: -$300 net loss

Expanding to 1 more location:

Here, there would be two actively operating branches which could take the following combinations of states.

GG: $600 net income

GM: $400 net income

GP: $200 net income

MM: $200 net income

MP: $0 net income

PP: -$200 net loss

Not expanding:

G: $300 net income

M: $100 net income

P: -$100 net loss

Explanation:

So as we can see, a certain business could be great, modest, or poor, each with corresponding income and loss, provided in the scenario.

Upon expansion to two more locations, there would be a total of three operating branches, which could be of 10 different combinations of business state. We will then take the sum of the possible net income and loss of each. For G we have +$300, M corresponds to +$100, and P to -$100 then we will simply take the sum to determine the total net loss or income of each combination.

Next, if they chose to expand to one more location, there will be two active business branches: so there would be a total of six different combinations of business state as enumerated earlier, then you will also apply the same procedure for adding each net income and loss.

Lastly, if there would be no expansion, then there will only be a single branch which could take one of the states G, M, or P each with their corresponding net income and loss. But as stated, business has been great, so you can take that as a fixed $300 for one branch. Thus leaving you with the combinations in bold format.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Sampling Design And Analysis

Authors: Sharon L. Lohr

2nd Edition

627

Students also viewed these Economics questions