Question 5 a) A financial analyst has recommended four possible listed firms for investment. The annual return that will be achieved depends on whether the stock market is good, fair, or poor. The following table summarizes the firms, market conditions and annual returns. Firm A Good 1170 Fair 530 Poor -1220 -530 B 780 620 880 2040 1620 -2810 -1790 D 840 Determine the best decision alternative using the following decision criteria: i. Pessimistic (5 marks) ii. Hurwicz (5 marks) iii. Laplace (5 marks) iv. Opportunity loss (5 marks) (Total: 20 Marks) Question 4 Cummins Generator Technologies Company purchases a special component used in the manufacture of auto mobile generators directly from its suppliers. The generator production operation, which is operated at a constant rate, will require 1200 components per month throughout the year. Assume that the ordering costs are RM20 per order, the unit cost is RM2 per component, and annual holding costs are 20% of the value of the cost price. The company has 300 working days per year, and the lead time is 5 days. The management at Cummins Generator Technologies plans to set their inventory policy and wants to determine the following: a) Compute the Economic Order Quantity (EOQ) for the component. (5 marks) b) Based on the optimum order quantity, determine the reorder point. c) Calculate the total inventory cost based on the current ordering policy. (5 marks) (5 marks) d) Determine the time between orders, (5 marks) (Total: 20 Marks)