Question
Philippines 17-1 You're the manager of global opportunities for a U.S. manufacturer that is considering expanding sales into Asia. Your market research has identified the
Philippines 17-1
You're the manager of global opportunities for a U.S. manufacturer that is considering expanding sales into Asia. Your market research has identified the market potential in Malaysia, the Philippines, and Singapore as described in the following table:
| Success Level | |||
|---|---|---|---|
| Big | Mediocre | Failure | |
| Malaysia | |||
| Probability | 0.4 | 0.3 | 0.3 |
| Units | 700,000 | 420,000 | 0 |
| Philippines | |||
| Probability | 0.5 | 0.3 | 0.2 |
| Units | 1,200,000 | 384,000 | 0 |
| Singapore | |||
| Probability | 0.1 | 0.7 | 0.2 |
| Units | 1,400,000 | 700,000 | 0 |
The product sells for $20, and each unit has a constant marginal cost of $16. Assume that the (fixed) cost of entering the market (regardless of which market you select) is $500,000.
1. In the following table, enter the expected number of units sold, and the expected profit, from entering each market. 
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Inventory Optimization Models And Simulations
Authors: Nicolas Vandeput
1st Edition
3110673916, 978-3110673913
