Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Statistics and Probability Expert

The Lake Placid Town Council has decided to build up a new community center to be employed for conventions, concerts, and other public events. But, considerable controversy surrounds proper size. Many influential citizens want the large center that would be the showcase for area. But the mayor feels that if demand doesn't support such a center,the community will lose the large amount of money. To provide structure for decision process, the council narrowed the building alternatives to three sizes: small, medium, and large. Everybody agreed that critical factor in selecting the best size is the number of people who will want to employ the new facility. A regional planning consultant provided demand approximates under three scenarios: worst case, base case, and best case. The worst-case scenario corresponds to the situation in which tourism drops significantly; the base-case scenario corresponds to a situation in which Lake Placid continues to attract visitors at current levels; and best-case scenario corresponds to a significant rise in tourism. The consultant has provided probability assessments of 0.10, 0.60, and 0.30 for worst-case, base-case, and best-case scenarios, respectively.

The town council suggested using net cash flow over five-year planning horizon as the criterion for deciding on the best size. The following projections of net cash flow, in thousands of dollars, for the five-year planning horizon have been developed. All costs, comprising the consultant's fee, have been included. 

 

Worst Case

Base Case

Best Case

Small

400

500

660

Medium

-250

650

800

Large

- 400

580

990

The consultant suggested that the expenditure of $150,000 on promotional campaign over the planning horizon will effectively minimize the probability of worst case scenario to zero. If the campaign can be expected to also to raise the probability of best case scenario to 0.4, is it a good investment.

Statistics and Probability, Statistics

  • Category:- Statistics and Probability
  • Reference No.:- M917753

Have any Question? 


Related Questions in Statistics and Probability

Scenario dr olson is interested in the effects of three

Scenario: Dr. Olson is interested in the effects of three different methods for losing weight in long-distance truck-drivers. He tested a sample of 60 truck drivers. Participants were randomly assigned to one of three gr ...

In onenbsptownnbsp24nbspof all voters are democrats if two

In one town, 24% of all voters are Democrats. If two voters are randomly selected for a survey, find the probability that they are both Democrats. Round to the nearest thousandth if necessary.

1 what is the range and why is it not ideal as an index of

1. What is the range, and why is it not ideal as an index of variability? 2. Give a definition of variance, then explain how you would calculate it. 3. How does variance differ from the total sum of squares?

Within a forensic investigation a sample was independently

Within a forensic investigation, a sample was independently analyzed for lead content by two different laboratories, Lab 1 and Lab 2. The analysis that was performed on this sample by Lab 1 yielded a coefficient of varia ...

A business student is interested in estimating the 99

A business student is interested in estimating the 99% confidence interval for the proportion of students who bring laptops to campus. He wishes a precise estimate and is willing to draw a large sample that will keep the ...

The centers for disease control and prevention released a

The Centers for Disease Control and Prevention released a report in 1998 that attributed part of the increase in youth smoking in the 1980s to the use of the cartoon character, Joe Camel, in cigarette advertising. Using ...

1 you wish to learn the proportion of mba students that are

1.) You wish to learn the proportion of MBA students that are female within 3%, and with 98% confidence. How large of a sample should you get? 2.) You wish to learn the average age of an MBA student within 2 years and wi ...

1 why do researchers care how much variability exists in a

1. Why do researchers care how much variability exists in a set of data? 2. Distinguish between descriptive and inferential statistics. 3. Conceptually, what does the variance tell us about a set of data?

In pre election a candidate receives 330 out of 650 votes

In pre election , a candidate receives 330 out of 650 votes. Assuming that the people polled represents a random sample of voting population, test the claim that a majority of voters supports the candidate. Use a signifi ...

A ski gondola carries skiers to the top of a mountain it

A ski gondola carries skiers to the top of a mountain. It bears a plaque stating that the maximum capacity is 14 people or 2324 lb. That capacity will be exceeded if 14 people have weights with a mean greater than 2324 l ...

  • 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

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

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