sign Layout References >> Arial Share v 14 v ' ' A M Paste Aa v to BIU vor Av Paragraph Office Update To keep up-to-date with security updates, fixes, and improveme... Styles Check for 6 Problem 2 (4 Marks) Arrow company is a small supplier of chemicals and equipment that are used by some photographic stores to process 35mm film. One product that Arrow company supplies is BC-6. Ahmed, president of Arrow company, normally stocks 11, 12, or 13 cases of BC-6 each week. For each case that the company sells, they receive a profit of $35. Like many photographic chemicals, BC-6 has a very short shelf life, so if a case is not sold by the end of the week, the company must discard it. Since each case costs the company $56, they loose $56 for every case that is not sold by the end of the week. If a case is demanded and the company was short to satisfy, the company loses 206. There is a probability of 0.50 of selling 11 cases, a probability of 0.30 of seling 12 cases, and a probability of 0.2 of selling 13 cases. (a) Construct a decision table for this problem. Include all conditional values and probabilities in the table. (b) What is your recommended course of action? (c) If the company was able to develop BC-6 with an ingredient that stabilizes it so that it no longer has to be discarded, how would this change your recommended course of action? ALJA Page 3 of a TOON ne Insert QuSearch in Document Draw Design Layout References >> X Share ILS Arial 14 ste BI U VA A Aa v Ao # x, x ADA Apr Paragraph Styles Office Update To keep up-to-date with security updates, fixes, and improveme... 5 Check for Problem 3 (4 Marks) Mr. Ahmed has developed a decision tree (see the tree below) regarding the profitability of the bicycle shop. If Mr. Ahmed builds the large bicycle shop, he will earn QR 80,000 if the market is favorable, but he will lose QR 50,000 if the market is unfavorable. The small shop will return a QR 35,000 profit in a favorable market and a QR 15,000 loss in an unfavorable market. At the present time, he believes that there is a 60 chance that the market will be favorable. If he conducted the market study, it will cost him QR 8,000. It is estimated that there is a 0.65 probability that the Market study will be favorable. Furthermore, there is a 0.85 probability that the market will be favorable given a favorable outcome from the study. However, the market study showed that there is only a probability of 0.30 of a favorable market if the marketing research results are not favorable. (a) Draw the decision tree (b) Should Mr. Ahmed conduct the market study? I Focus Page 4 of 6 874 words