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fully solve and show solution An electronics shop is about to buy some laptop computers. They can be ordered from the manufacturer at a cost
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An electronics shop is about to buy some laptop computers. They can be ordered from the manufacturer at a cost of $800 each. The selling price will be set at $1100 each. Demand is estimated as being between 7 and 10 inclusive with probabilities 0.1 for 7,0.3 for 8,0.4 for 9 , and 0.2 for 10 . When a more technologically advanced computer becomes available any leftover of the current model will be marked down to $650 each (all leftover stock will sell with no problem at this price). (a) We wish to determine how many computers should be ordered, according to the following decision criteria: (i) Expected Value, (ii) pessimism, (iii) optimism, and (iv) Laplace. Do this by using a calculator to fill in all the numbers in the range B4:I7 (next page), and state the four recommendations clearly. (b) Find the EV with PI, and the EVPI. (c) Repeat part (a) using ExcelStep by Step Solution
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