Your company has a customer who is shutting down a production line, and it is your responsibility to dispose of the extrusion machine. The company could keep it in inventory for a possible future product and estimates that the reservation value is $200,000. Your dealings on the secondhand market lead you to believe that if you commit to a price of $300,000, there is a 0.5 chance you will be able to sell the machine. If you commit to a price of $400,000, there is a 0.2 chance you will be able to sell the machine. If you commit to a price of $500,000, there is a 0.1 chance you will be able to sell the machine. These probabilities are summarized in the following table. For each posted price, enter the expected value of attempting to sell the machine at that price. (Hint: Be sure to take into account the value of the machine to your company in the event that you are not be able to sell the machine.) Posted Price Expected Value ($) Probability of Sale ($) $500,000 0.1 $400,000 0.2 24 $300,000 0.5 Assume you must commit to one posted price. In order to maximize the expected profit of the potential sale, which posted price would you commit to in order to maximize the expected value of the potential sale of the machine? $500,000 O $300,000 O $400,000

Problem 05-19 The A-1 Corporation supplies airplane manufacturers with preformed sheet metal panels that are used on the exterior of aircraft. Manufacturing these panels requires only five sheet metal-forming machines, which cost $500 each, and workers. These workers can be hired on an as-needed basis in the labor market at $9,000 each. Given the simplicity of the manufacturing process, the preformed sheet metal panel market is highly competitive. Therefore, the market price for one of A-1's panels is $80. Based on the production data in the accompanying table, how many workers should A-1 hire to maximize its profits? Machines Workers Output 5 1 600 1,000 1,290 2 3 4 1,480 5 1,600 1,680 Number of workers:

The research department at a manufacturing company has developed a new process that it believes will result in an improved product Management must decide whether to go ahead and market the new product. The new product may or may not be better than the old one. If the new product is better and the company decides to market it, sales should increase by $50,000. If it is not better and they replace the old product with the new product on the market, they will lose $24,000 to competitors. If they decide not to market the new product, they will lose a total of $30,000 if it is better and just research costs of $10,000 if it is not. Answer parts a through c below. (a) Prepare a payoff matrix. (Type an integer or decimal for each matrix element. Do not include the $ symbol in your answer.) (b) If management believes there is a probability of 0.4 that the new product is better, find the expected profits under each strategy and determine the best action. Select the correct answer below and fill…

Mr. Nelson, the manager of a US company, entered into a contract with an Italian company, Roma, to order some leather suitcases. The Goods were delivered on time, but with some of the zippers on the suitcase defective. Mr. Nelson contracted Roma and gave a notice that he wanted to cancel the contract. Roma responded that they only can give a reduction in the price. Who is legally right?

Suppose that there are two fancy hotels on the online booking platform, say W hotel and Ritz Carlton hotel. Each hotel has the capacity of 20 rooms on the New Year Eve. There are 20 families who are planning to stay at Bay Areas. Suppose that you are the manager and you set the price to maximize the hotel profit. The marginal cost of each hotel room = 500 RMB The largest valuation on the hotel room = 2000 RMB valuation decrease by 100RMS. In total, there are 20 families. Discuss with your peers how many rooms you will offer in the market.

Juanita is deciding whether to buy a skirt that she wants, as well as where to buy it. Three stores carry the same skirt, but it is more convenient for Juanita to get to some stores than others. For example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $102 for the skirt:        Store Travel Time Each Way Price of a Skirt (Minutes) (Dollars per skirt) Local Department Store 15 102 Across Town 30 85 Neighboring City 60 76   Juanita makes $42 an hour at work. She has to take time off work to purchase her skirt, so each hour away from work costs her $42 in lost income. Assume that returning to work takes Juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. As you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling.

Van believes that housing prices are likely to rise rapidly in the near future and wants to profit by investing in real estate. He is considering buying individual properties, but he has little practical knowledge of real estate. A friend suggests that he buy    the real estate sector, because this type of investment vehicle offers diversification within a particular sector.