The director of surgery at a local hospital is interested in understanding his unit’s costs. An assistant collected data for the past 36 months on unit cost (labor, supplies, and so on) along with the number of procedures performed in the unit. The assistant analyzed the data using a spreadsheet program, and the following output was generated. Equation Intercept$1,013,000 Coefficient on procedures$210 Statistical data Correlation coefficient 0.553 R2 0.303 The unit is planning to perform an average 13,500 procedures per month for the coming year. Required:a. Use the regression output to write the surgical unit cost equation.b. Based on the cost equation, compute the estimated costs for the surgical unit per month for the coming year.c. The director of surgery has asked you for advice on whether he should rely on the estimate.

The form of the regression equation is y=mx+b where y is the dependent variable, b is the…

Use the regression output to write the surgical unit cost equation. b. Based on the cost equation, compute the estimated costs for the surgical unit per month for the coming year. c. The director of surgery has asked you for advice on whether he should rely on the estimate.

Use the regression output to write the surgical unit cost equation. b. Based on the cost equation, compute the estimated costs for the surgical unit per month for the coming year. c. The director of surgery has asked you for advice on whether he should rely on the estimate.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter10: Introduction To Simulation Modeling

Section: Chapter Questions

Problem 41P: At the beginning of each week, a machine is in one of four conditions: 1 = excellent; 2 = good; 3 =...

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At the beginning of each week, a machine is in one of four conditions: 1 = excellent; 2 = good; 3 = average; 4 = bad. The weekly revenue earned by a machine in state 1, 2, 3, or 4 is 100, 90, 50, or 10, respectively. After observing the condition of the machine at the beginning of the week, the company has the option, for a cost of 200, of instantaneously replacing the machine with an excellent machine. The quality of the machine deteriorates over time, as shown in the file P10 41.xlsx. Four maintenance policies are under consideration: Policy 1: Never replace a machine. Policy 2: Immediately replace a bad machine. Policy 3: Immediately replace a bad or average machine. Policy 4: Immediately replace a bad, average, or good machine. Simulate each of these policies for 50 weeks (using at least 250 iterations each) to determine the policy that maximizes expected weekly profit. Assume that the machine at the beginning of week 1 is excellent.
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