Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Operation Management Expert

Expando, Inc., is considering possibility of building the additional factory which would create a new addition to their product line. The company is at present considering two options. The first is small facility which it could build at a cost of $8 million. If demand for new products is low, the company anticipates receiving $10 million in discounted revenues (present value of future revenues) with the small facility. On other hand, when demand is high, it expects $11 million in discounted revenues by using the small facility. The second option is to create a large factory at a cost of $9 million. Were demand to be low, the company would anticipate $11 million in discounted revenues with large plant. If demand is high, the company approximates that the discounted revenues would be $15 million. In either case, the probability of demand being high is .80, and probability of it being low is .20. Not constructing the new factory would result in no additional revenue being generated since the current factories can’t manufacture these new products.

a. Evaluate the NPV for following: (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers in millions rounded to 1 decimal place.)

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M914532

Have any Question? 


Related Questions in Operation Management

Emergency managers should know how to assess vital

Emergency managers should know how to assess vital buildings in communities in order to protect the occupants in light of an emergency. Access the Anytown, USA Simulation. Assess the government building in the Downtown R ...

Please help with the following 2 questions please provide

Please help with the following 2 questions. Please provide a separate answer and a reference for each. Q1. Discuss the strategic importance of layout decisions. How can a particular layout affect a company's strategic go ...

What specific role does the integration of hris play in an

What specific role does the integration of HRIS play in an organization's training program. Explain how HRIS can be used to increase the efficiency and effectiveness of training initiatives. Parameters: Your initial resp ...

Sonnys supermarket chain has decided to build its own

Sonny's Supermarket chain has decided to build its own warehouse. The local chain has four markets (A,B,C,D) with location and weekly demand listed in the table below. a. If Sonny chooses the warehouse location to be adj ...

Based on the attached documents assess cvss performance

Based on the attached documents, assess CVS's performance relative to its competitors, Walgreen's and Rite Aid (at minimum, use cash-to-cash cycle time and return on assets). If CVS adopts a lean philosophy and is able t ...

For your initial post consider a time in your life when you

For your initial post, consider a time in your life when you had to look at something a little closer to make sense of it. This moment might focus on a document (like the grocery list example from the previous screen), a ...

A company provides it services to companies that need

A company provides IT services to companies that need additional temporary IT support. Currently, the company has about 90% of its staff engaged in other long-term client projects. A new highly desired customer bids for ...

Read the article that presents the application of six sigma

Read the article that presents the application of Six Sigma in research and development firms. Summarize the "lessons learned" in this article, and explain how you would apply the lessons at your job or work.

Discussion video analysis faa gate to gate - nextgen

Discussion: Video Analysis: FAA Gate to Gate - NextGen Explained Whether you're flying in an airliner or piloting your own private airplane, you may feel you're getting more than your share of flight delays. Delays are m ...

A manufacturer of industrial sales has production capacity

A manufacturer of industrial sales has production capacity of 1,000 units per day. Currently, the firm sells production capacity for $10 per unit. At this price, all production capacity gets booked about one week in adva ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen