Problem 3 3 points Expando, Inc., is considering the possibility of building an additional factory that would produce a new addition to its product line. The company is currently considering two options. The first is a small facility that it could build at a cost of $7.5 million. If demand for new products is low, the company expects to receive $12 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects $15 million in discounted revenues using the small facility. The second option is to build a large factory at a cost of $10 million. Were demand to be low, the company would expect $12 million in discounted revenues with the large plant. If demand is high, the company estimates that the discounted revenues would be $20 million. In either case, the probability of demand being high is .35, and the probability of it being low is .65. Not constructing a new factory would result in no additional revenue being generated because the current factories cannot produce these new products. Construct a decision tree to help Expando make the best decision. a) Which decision should Expando, Inc. make? b) Why? Problem 5 3 points The home office billing department of a chain of department stores prepares monthly inventory reports for use by the store's purchasing agents. Given the following information, use the critical path method to determine: COMPLETE THE NETWORK DIAGRAM a. How long the total process will take. b. Which jobs can be delayed without delaying the early start of any subsequent activity? Activity A B C D E F G H Job and Description Start Get computer printouts of customer purchases Get stock records for the month Reconcile purchase printouts and stock records Total stock records by department Determine reorder quantities for coming period Prepare stock reports for purchasing agents Finish Immediate predecessors A A B, C B D E, F G Time (Hours) 0 10 30 25 20 40 25 0