38. Carlisle Tire and Rubber, Inc., is considering expanding production to meet potential increases in the demand for one of its tire products. Carlisle’s alternatives are to construct a new plant, expand the existing plant, or do nothing in the short run. The market for this particular tire product may expand, remain stable, or contract. Carlisle’s marketing department estimates the probabilities of these market outcomes as 0.25, 0.35, and 0.40, respectively. The attached file contains Carlisle’s estimated payoff (in dollars) table.a. Use PrecisionTree to identify the strategy that maximizes this tire manufacturerâs expected profit.b. Perform a sensitivity analysis on the optimal decision, letting each of the monetary inputs vary one at a time plus or minus 10% from its base value, and summarize your findings. In response to which monetary inputs is the expected profit value most sensitive?40. Techware Incorporated is considering the introduction of two new software products to the market. In particular, the company has four options regarding these two proposed products: introduce neither product, introduce product 1 only, introduce product 2 only, or introduce both products. Research and development costs for products 1 and 2 are $180.000 and $150,000, respectively. Note that the first option entails no costs because research and development efforts have not yet begun. The success of these software products depends on the trend of the national economy in the coming year and on the consumersâ reaction to these products. The companyâs revenues earned by introducing product 1 only, product 2 only, or both products in various states of the national economy are given in the table below. The probabilities of observing a strong, fair, and weak trend in the national economy in the coming year are 0.30, 0.50, and 0.20, respectively.a. Formulate a payoff table that specifies Techwareâs net revenue (in dollars) for each possible decision and each outcome with respect to the trend in the national economy.b. Use Precision Tree to identify the strategy that maximizes Techwareâs expected net revenue from the given marketing opportunities.c. Perform a sensitivity analysis on the optimal decision, letting each of the inputs vary one at a time plus or minus 25% from its base value, and summarize your findings. In response to which model inputs is the expected net revenue most sensitive?
DISCLAIMER
papertowrite.com helps students cope with college assignments and write papers on a wide range of topics. We deal with academic writing, creative writing, and non-word assignments.
Security
The privacy of our customers is highly important for us. No personal information or financial data will be passed to third parties. Read our Privacy Policy to find out more information.
Contact
SUBMIT A WRITTEN REQUEST AND OUR CUSTOMER SERVICE TEAM WILL REPLY BACK TO YOU AS QUICKLY AS POSSIBLE (USUALLY WITHIN 10 MINUTES).
E mail:papertowriters@gmail.com
Phone:+1 (469) 723-6148