(TCO 1) Given a business scenario, evaluate the role different modeling techniques might play in finding solutions.
1.(TCO 1)You are thinking of opening a small copy shop. It costs $5,000 to rent a copier for a year and it costs $0.03 per copy (including paper) to operate the copier. Other fixed costs of running the store will amount to $400 per month. You plan to charge an average of $0.10 per copy, and the store will be open 365 days per year. Each copier can make up to 100,000 copies per year.
ØUsing the file entitled Scenario 1 Solution available in the Week 8 Materials directory in Doc Sharing answer the following questions:
ØShow all of your work for each step. You will need to copy and paste from the Excel spreadsheets for each step as appropriate.
(TCO 2) Given a managerial problem and accompanying scenario for which a constrained optimization model is appropriate, identify the appropriate model components, translate them to equation form, solve the optimal solution, perform a sensitivity analysis, and use the results to decide on a course of action relative to the problem
(TCO 3) Given a business scenario, you should be able to recognize it as one of four types (transportation, assignment, logistic, or shortest path); identify the nodes and arcs; specify the input variables, decision variables, objective function, and constraints; and solve for an optimal solutions perform, a sensitivity analysis, and interpret the results.
30 points (TCO 4)Given a business situation and accompanying data set and Excel template for which decision-making under uncertainty model is appropriate, you should be able to describe the major steps in formulating the model; identify the appropriate variables and their respective roles in the model; construct the major components such as the payoff table and the likelihood of outcomes; and solve the model and interpret the results.
A farmer must decide whether to take protective action to limit damage to his grapefruit crop in the event that the overnight temperature falls to a level well below freezing. If the temperature drops too low he runs the risk of losing his entire crop, valued at $75,000. Based on the National Weather Service, the probability of such a temperature drop is 60%. He can insulate his crop by spraying water on all the trees, which will cost $20,000. This action might succeed in protecting the crop, with the following possible outcomes:
(TCO 5)Given a managerial problem and accompanying data set and Excel template for which simulation is an appropriate solution approach, identify the possible probability distributions that might be used; construct the model and generate the output distribution; and interpret the results and perform an analysis to determine the sensitivity of the system to changes in operating conditions.