problem 2 please Draw a project network for a Happy Smart Phone training program

Question

problem 2 please

Draw a project network for a Happy Smart Phone training program including the start and the end. What is the critical path, and minimum time to complete the project? Happy CEO is considering investing some money that was inherited. The following table gives the profits that would be realized during the next year for three different options? What is the maximax, maximin, equally-likely, minimax regret solutions? What is the solution, if there is 0.60 probability of a Good Economy? Happy says that worldwide internet ad revenues are given a $10B(Year 1), $13B (Year 2), $17B (Year 3). Please forecast the "Year 4" value using a 3-year moving average? Do the same for exponential smoothing starting with a Year 1 initial forecast of $10B, and an Alpha of 0.4. Also, forecast the "Year 4" value using a linear trend line. Stock price of the Happy stock is currently $41 per share. The following probability distribution shows how the price per share is expected to change over a one-month period. Using random numbers 0.1091, 0.9407, 0.1941, 0.8083 simulate the price per share for the next four months. What is the final simulated price per share? Happy Smart Phone has a product that shows a constant annual demand of 30,000 units. Each unit cost Happy 56. Ordering cost are $10 per order and the bolding costs are 10% of the value of the inventory. Happy has 365 working days per year, and the lead-time is 5 days. Identify the Economic Order Quantity, the reorder point, number of orders per year, ordering cycle time, and the total annual inventorying cost.

Explanation / Answer

2.

Maximax:

In this decision criteria, maximum of the maximum payoff is selected as a solution. Maximum payoff of stock is $90000, for bond, $30000 and for CDS, it is $120000. Out of all these three, maximum payoff comes from stock that is $900000. Thus, it is the desired solution under Maximax criteria.

Maximin:

Under this decision criteria, maximum of the minimum payoff is selected as a solution. Minimum payoff by stock, bond and CDs are - $20000, $20000 and $12000 respectively. Here, maximum of the minimum payoff is $20000 from bonds and it is the solution under Maximin decision criteria.

Minimax regret:

In this criteria, we first select the best return in each form of economy and subtract other return in the same column.

Return (good Economy)

Return (poor Economy)

Stock

90000

-20000

Bond

30000

20000

CDs

12000

12000

Return (good Economy)

Return (poor Economy)

Stock

0

40000

Bond

60000

0

CDs

78000

8000

Here, $90000 is the best payoff in good economy. Thus, it is selected and all payoff in good economy is subtracted from $90000. Similarly it is also done for poor economy.

Now, maximum regret of each row is identified and lowest of all maximum regret is selected as a decision criteria.

On this basis, the lowest regret is $40000 out of $40000, $60000 and $78000 . Thus, it is the solution.        

Equally likely criteria:

Expected return from stock = .5*90000 + .5*(-20000) = $35000

Expected return from bond = .5*30000 + .5*20000 = $25000

Expected return from CDs = .5*12000 + .5*12000 = $12000

Maximum payoff comes by stock . Thus, stocks should be chosen for investment.

When the probability of good economy is 60%

Then ,

Expected return from stock = .6*90000 + .4*(-20000) = $46000

Expected return from bond = .6*30000 + .4*20000 = $26000

Expected return from CDs = .6*12000 + .4*12000 = $12000

Maximum payoff comes by stock. Thus, stocks should be chosen for investment.

Return (good Economy) Return (poor Economy) Stock 90000 -20000 Bond 30000 20000 CDs 12000 12000

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