Submitted by: Submitted by nysfavored
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Category: Business and Industry
Date Submitted: 11/07/2011 11:14 AM
Week 2: Answers to discussion questions
Problem 1 page 229
A. Maximax: Expand [$80 is the highest payoff]
B. Maximin: Do Nothing @ $50 is the best of worst payoffs.
C. Laplace: Do Nothing and Subtract are both $55
D. Mimimax Regret:
E.
Low High Worst
Do Nothing 0 20 20
Expand 30 0 30
Subcontract 10 10 10 [best of worst]
Problem 14 page 356
a. First rank or arrange the number of trips from high to low.
Department Number of trips
2-4 90
1-4 80
3-4 55
2-3 40
From this we can see that departments 2 and 4 have the greatest interdepartmental work flow, so they should be closed, perhaps locations C and B. Next, we can see that the work flows for 1 and 4, 3 and 4 are high. Therefore departments 4 has to be located at a central location (location B), while department 2 is in location C, department 1 is in location A, and department 3 is in location D.
Distance * Number of trips matrix
Department 1 2 3 4
1 ------ (10 x 80) = 800 (20 x 70) = 1400 (80 x 40) = 3200
2 ------- ------- (40 x 60) = 2400 (90 x 40) = 3600
3 --------- --------- -------- (55 x 50) = 2750
4...