Question: This assignment must be in Excel/QM . A manager needs to hire short-term employees to meet production demands. The manager would like to hire one
This assignment must be in Excel/QM .
A manager needs to hire short-term employees to meet production demands. The manager would like to hire one of three possible short-term workers. Ten hours are demanded with 50% probability, 20 hours are demanded with 20% probability, and 30 hours are demanded with 30% probability. The table below represents the alternatives and possible states of nature.
|
| States of Nature |
|
|
|
| (Worker hrs. demanded) |
|
|
| Alternatives | 10 hr. total pay | 20 hr. total pay | 30 hr. total pay |
| Worker 1 | $975.00 | $1,850.00 | $2,500.00 |
| Worker 2 | $900.00 | $1,800.00 | $2,500.00 |
| Worker 3 | $950.00 | $1,750.00 | $2,500.00 |
a) Which alternative will minimize the expected monetary value?
b) What is the expected value of perfect information?
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