Finite Mathematics Quiz
8 questions · no time limit
0:00
DECISION ANALYSIS
Question 1 of 8
No time limit
Current
Answered
Flagged
Not seen
PASSAGE
A company must decide between building a small plant or a large plant. The profitability of each depends on future market demand, which can be high or low, with equal probability (P(High) = 0.5, P(Low) = 0.5). A small plant yields a profit of $100,000 with high demand and $40,000 with low demand. A large plant yields a profit of $250,000 with high demand but a loss of $50,000 with low demand.
A consulting firm offers a new technology that would only affect the profit of the small plant in a high-demand market. What is the minimum profit the small plant with high demand would need to generate for the optimal decision to switch from 'Build Large' to 'Build Small'?
YOUR PROGRESS
8
QUESTIONS
Ready when you are
Answer in any order. Your progress shows here as you go.
QUESTIONS
KEYBOARD
Pick an answer ABCD
Next question ↵→
Previous ←
Flag for review F
Answers save as you go · flagged questions come back at the end