The report will be a formal, professional report with the following sections:
Abstract/Executive summary
Introduction: case summary and problem statement
Methodology/Analysis to the stated questions or the stated problem
Conclusion
References
Appendixes; to, for example, include generated computer outputs (excel sheets and how they are formulated)
The XYZ Company c. Based on the past data, Katharine is further convinced that the capital investment, annual revenue, useful lives, and salvage values can be considered random variables with the following specified probability distributions. She also asks you to develop a simulation of 100 sample points of AW values at a MARR 0f20%/year. Interpret your results and indicate which alternative should be sclected. Katharine Rally is the vice president of operations for the XYZ Company. She oversees operations at a plant that manufactures components for hydraulic systems. Katharine is concerned about the plant's present production capability. She has reduced the decision situation to three altematives. The first altemative, which is fully automation, would result in significant changes in present operations. The second alternative, which is semi- automation, involves fewer changes in present operations. The third alternative is to make no changes (do nothing). Hint: Use the Random Number Generation (RNG) Data Analysis Tool package of Microsoft Exccl. The online help function explains how to initiate and use the RNG to generate random numbers from a variety of probability distributions: normal, uniform (continuous variable), binomial, Poisson, and discrete. Some of these concepts have been explained in the MSE 604 textbook. As a manager of the plant management team, you have been assigned the task of analyzing the alternatives and recommending a course of action. The capital investment and annual revenue for the first two alternatives are shown in the following table: Alternative tematiVC evenuc Parameter Average Poor 0,000 S100,000 550,000 Normal Mcan: $300,000 Std. dev:$50,000 Capital Mean: $85,000 Std. dev.: S500 85,000 Average $30,000 Annual Revenuc The annual revenue estimates are based on future sales of the components. The sales department estimates the probability of good, average, and poor future sales as 0.30, 0.60, Mean: S150,000 Std. dev.:$10,000 Mean: S85,000 Std. dev.: $300 and 0.1, respectively Useful live a. Itis known that Katharine is a big fan of decision tree analysis. Based on a before-tax analysis (MARR-20% per year, study period of 5 years, and a salvage value of 20% of the capital investment) and the E(PW) as a decision criterion, determine which alternative is preferred. What would be the expected value of perfect information in r decision tree and conduct Discrete uniform 3 to 8 ycars with equal probability Discrete uniform 3 to 7 years with equal probability Salvage Value this case? Use the Uniform 30,000 to S60,000 Uniform S10,000 to S20000 software to draw b. Katharine has realized that additional information about future sales of the hydraulic components should reduce the uncertainty invlved. Therefore, she asked the sales department to survey their customers about the future sales conditions. They conducted a survey and determined the conditional probabilities as shown in the following table. Based on this information, develop a two-stage decision tree and determine which altermative is preferred. Use the Precision Tree software to draw r decision tree and conduct v r analvsis Given the Future Sales Conditior ptimistic The XYZ Company c. Based on the past data, Katharine is further convinced that the capital investment, annual revenue, useful lives, and salvage values can be considered random variables with the following specified probability distributions. She also asks you to develop a simulation of 100 sample points of AW values at a MARR 0f20%/year. Interpret your results and indicate which alternative should be sclected. Katharine Rally is the vice president of operations for the XYZ Company. She oversees operations at a plant that manufactures components for hydraulic systems. Katharine is concerned about the plant's present production capability. She has reduced the decision situation to three altematives. The first altemative, which is fully automation, would result in significant changes in present operations. The second alternative, which is semi- automation, involves fewer changes in present operations. The third alternative is to make no changes (do nothing). Hint: Use the Random Number Generation (RNG) Data Analysis Tool package of Microsoft Exccl. The online help function explains how to initiate and use the RNG to generate random numbers from a variety of probability distributions: normal, uniform (continuous variable), binomial, Poisson, and discrete. Some of these concepts have been explained in the MSE 604 textbook. As a manager of the plant management team, you have been assigned the task of analyzing the alternatives and recommending a course of action. The capital investment and annual revenue for the first two alternatives are shown in the following table: Alternative tematiVC evenuc Parameter Average Poor 0,000 S100,000 550,000 Normal Mcan: $300,000 Std. dev:$50,000 Capital Mean: $85,000 Std. dev.: S500 85,000 Average $30,000 Annual Revenuc The annual revenue estimates are based on future sales of the components. The sales department estimates the probability of good, average, and poor future sales as 0.30, 0.60, Mean: S150,000 Std. dev.:$10,000 Mean: S85,000 Std. dev.: $300 and 0.1, respectively Useful live a. Itis known that Katharine is a big fan of decision tree analysis. Based on a before-tax analysis (MARR-20% per year, study period of 5 years, and a salvage value of 20% of the capital investment) and the E(PW) as a decision criterion, determine which alternative is preferred. What would be the expected value of perfect information in r decision tree and conduct Discrete uniform 3 to 8 ycars with equal probability Discrete uniform 3 to 7 years with equal probability Salvage Value this case? Use the Uniform 30,000 to S60,000 Uniform S10,000 to S20000 software to draw b. Katharine has realized that additional information about future sales of the hydraulic components should reduce the uncertainty invlved. Therefore, she asked the sales department to survey their customers about the future sales conditions. They conducted a survey and determined the conditional probabilities as shown in the following table. Based on this information, develop a two-stage decision tree and determine which altermative is preferred. Use the Precision Tree software to draw r decision tree and conduct v r analvsis Given the Future Sales Conditior ptimistic
