7. An engineering firm has decided to bid for a major project. The activities and their...
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7. An engineering firm has decided to bid for a major project. The activities and their time estimates are given below: Activity 1-2 2-3 2-4 2-8 3-4 (dummy) 3-5 4-6 5-7 (dummy) 5-9 Optimistic 15 16 13 18 0 15 11 6-7 (dummy) 6-8 (dummy) 7-9 8-9 Most Likely 16 17 15 17 0 18 19 0 18 0 0 15 0 0 0 17 40 16 21 The firm has a policy of submitting bids of minimum amount that will provide a 95% of probability of at best breaking-even. The fixed costs for the project are USD 10 million and the variable costs are USD 100000 every day spent working on the project. Note that the duration is in days and the costs are in USD. What is the amount that the firm should bid under this policy? Pessimistic 25 20 18 28 0 27 21 0 19 0 0 20 17 7. An engineering firm has decided to bid for a major project. The activities and their time estimates are given below: Activity 1-2 2-3 2-4 2-8 3-4 (dummy) 3-5 4-6 5-7 (dummy) 5-9 Optimistic 15 16 13 18 0 15 11 6-7 (dummy) 6-8 (dummy) 7-9 8-9 Most Likely 16 17 15 17 0 18 19 0 18 0 0 15 0 0 0 17 40 16 21 The firm has a policy of submitting bids of minimum amount that will provide a 95% of probability of at best breaking-even. The fixed costs for the project are USD 10 million and the variable costs are USD 100000 every day spent working on the project. Note that the duration is in days and the costs are in USD. What is the amount that the firm should bid under this policy? Pessimistic 25 20 18 28 0 27 21 0 19 0 0 20 17
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SOLUTION IN DETAILS To determine the amount that the firm should bid under the policy of having a 95 probability of at best breakingeven we can use th... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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