Assignment: Expansion Strategy And Establishing A Re-Order Point
PART1
Purpose of Assignment
This assignment has two cases. The first case is on expansion strategy. Managers constantly have to make decisions under uncertainty. This assignment gives students an opportunity to use the mean and standard deviation of probability distributions to make a decision on expansion strategy. The second case is on determining at which point a manager should re-order a printer so he or she doesn't run out-of-stock. The second case uses normal distribution. The first case demonstrates application of statistics in finance and the second case demonstrates application of statistics in operations management.
Resources: Microsoft Excel, Bell Computer Company Forecasts data set, Case Study Scenarios
Write a 1,050-word report based on the Bell Computer Company Forecasts data set and Case Study Scenarios.
Include answers to the following:
Case 1: Bell Computer Company
• Compute the expected value for the profit associated with the two expansion alternatives. Which decision is preferred for the objective of maximizing the expected profit?
• Compute the variation for the profit associated with the two expansion alternatives. Which decision is preferred for the objective of minimizing the risk or uncertainty?
Case 2: Kyle Bits and Bytes
• What should be the re-order point? How many HP laser printers should he have in stock when he re-orders from the manufacturer?
PART 2
Super Fun Toys Case Study
Purpose of Assignment
The purpose of this assignment is for students to learn how to make managerial decisions using a case study on Normal Distribution. This case uses concepts. It provides students an opportunity to perform sensitivity analysis and make a decision while providing their own rationale. This assignment also shows students that statistics is rarely used by itself. It shows tight integration of statistics with product management.
Resources: Microsoft Excel, SuperFun Toys Case Study, SuperFun Toys Case Study Data Set
Review the SuperFun Toys Case Study and Data Set.
Develop a 1,050-word case study analysis including the following:
Use the sales forecaster's prediction to describe a normal probability distribution that can be used to approximate the demand distribution.
• Sketch the distribution and show its mean and standard deviation. Hint: To find the standard deviation, think Empirical Rule covered.
• Compute the probability of a stock-out for the order quantities suggested by members of the management team (i.e. 15,000; 18,000; 24,000; 28,000).
• Compute the projected profit for the order quantities suggested by the management team under three scenarios: pessimistic in which sales are 10,000 units, most likely case in which sales are 20,000 units, and optimistic in which sales are 30,000 units.
• One of SuperFun's managers felt the profit potential was so great the order quantity should have a 70% chance of meeting demand and only a 30% chance of any stock- outs. What quantity would be ordered under this policy, and what is the projected profit under the three sales scenarios?
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.
Attachment:- Case-Study-Scenarios.rar