Question: Sax Engineering designs and constructs ar conditioning and heating (HVAC) systems for hospitals and dinics. Curteritly the company's staff is overloaded with design work. There

Sax Engineering designs and constructs ar

Sax Engineering designs and constructs ar conditioning and heating (HVAC) systems for hospitals and dinics. Curteritly the company's staff is overloaded with design work. There is a major design project due in weeks. The penalty for completing the design late is $13,000 per week, since any delay wil cause the facility to open later than anticipated, and cost the cient significant revenue. If the company uses its inside engineers to complete the design, it will have to pay them overtime for all work. Sox has estimated Wat it will cost $11,000 per week (wages and overhead), including late weeks, to herwe company engineers complete the design. Sox is also considering having an outside engineering tin do the design. A bld of S92.000 has been received for the completed cellan. Yet another option for completing the design is to conduct a joint design hy having a third engineering company complete all peoramachanical components of the resignat a cost of $BC,DID). Sow would then complate the rest of the design and partial systems at an estimated cost of S32.000). Sox has estimated the following probabilities of completing the project within various time frames when using each of the three options. Those estimates are shown in the following table: On Time Three Weeks Late Option Internal Engineers External Engineers Joint Design Probabilty of Completing the Design One Week Late Two Weeks Late 0.5 0.2 0.2 03 0.3 4.2 0.2 0 The expected morietary value using inside engineers to complele the design is 8 (Enter your response as an inleyer.) The expected monetary value using an outside engineering firm ba complete the design is (Entar jaw Sponse as integrar.) The expected Monetary value of conducting a joint design is $(Enter your response as en integer. What is the best decision based on an expected monetary value criterion? O Joint design O External engineering firm Internal engineers

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