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The operations manager for a local bus company wants to deci…

Posted byAnonymous June 8, 2021June 14, 2021

Questions

The оperаtiоns mаnаger fоr a local bus company wants to decide whether he should purchase a small, medium, or large new bus for his company. He estimates that the annual profits (in $000) will vary depending upon whether passenger demand is low, moderate, or high, as follows: Bus             Low Demand     Medium Demand         High Demand      Small 50 60 70 Medium 40 80 90 Large 20 50 120 If he feels the chances of low, moderate, and high demand are 30%, 30%, and 40% respectively, what is his expected value of perfect information? 

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Tags: Accounting, Basic, qmb,

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