MAT 540 WEEK 1 TO 11(Strayer)

5764 words 24 pages
MAT 540 WEEK 1 TO 11(Strayer)
MAT540 Week 1 Homework
Chapter 1, Problems 2, 4, 12, 14, 20, 22
2. The Retread Tire Company recaps tires. The fixed annual cost of the recapping operation is $60,000.The variable cost of recapping a tire is $9.The company charges $25 to recap a tire.
a. For an annual volume of 12,000 tires, determine the total cost, total revenue, and profit.
b. Determine the annual break-even volume for the Retread Tire Company operation.
4. Evergreen Fertilizer Company produces fertilizer. The company’s fixed monthly cost is $25,000, and its variable cost per pound of fertilizer is $0.15. Evergreen sells the fertilizer for $0.40 per pound. Determine the monthly break-even volume for the
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The following payoff table shows the profit or loss that could result from each investment: Gasoline Availability
Stable Supply
Restaurant 2,000 8,000 6,000
6,000 6,000 5,000
Determine the best investment, using the following decision criteria.
a. Maximax
b. Maximin
c. Minimax regret
d. Hurwicz (α = 0.4)
e. Equal likelihood
16. A concessions manager at the Tech versus A&M football game must decide whether to have the vendors sell sun visors or umbrellas. There is a 30% chance of rain, a 15% chance of overcast skies, and a 55% chance of sunshine, according to the weather forecast in College Junction, where the game is to be held. The manager estimates that the following profits will result from each decision, given each set of weather conditions: Weather Conditions
Sunshine .30
Sun visors
a. Compute the expected value for each decision and select the best one.
b. Develop the opportunity loss table and compute the expected opportunity loss for each decision.
24. In Problem 13 the Place-Plus real estate development firm has hired an economist to assign a probability to each