Question: 1. Draw a decision tree for the following case. Current capacity: 20,000 units per year Two options are being considered: (a) Add additional capacity of
1. Draw a decision tree for the following case. Current capacity: 20,000 units per year Two options are being considered: (a) Add additional capacity of 20,000 units at an annualized fixed cost of $15 million with labor cost of $600 per unit (b) Outsource at a cost of $18,000 per unit. Draw the decision tree for two year time horizon. During each year, demand has an 70% chance of increasing 40% and 30% chance of remaining the same
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