Emily scott head of a small business consulting firm must


Emily Scott, head of a small business consulting firm, must decide how many M.B.A.s to hire as full-time consultants for the next year. (Emily has decided that she will not bother with any part-time employers.) Emily knows from experience that the probability distribution on the number of consulting jobs her firm will get each year is as follow: consulting jobs: 24, 27, 30, 33, Probability: 0.3, 0.2, 0.4, 0.1. Emily also knows that each M.B.A. hired will be able to handle exactly three consulting jobs per year. The salary of each M.B.A. is $60,000. Each consulting job is worth $30,000 to Emily's firm. Each consulting job that the firm is awarded but cannot complete costs the firm $10,000 in future business lost. (a) How many M.B.A.s should Emily hire? (b) What is the expected value of perfect information to Emily?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Emily scott head of a small business consulting firm must
Reference No:- TGS01736194

Expected delivery within 24 Hours