This assignment has two cases. The first case is on expansion strategy.Managers constantly have to make decisions under uncertainty. Thisassignment gives students an opportunity to use the mean and standarddeviation of probability distributions to make a decision on expansionstrategy. The second case is on determining at which point a managershould re-order a printer so he or she doesn’t run out-of-stock. Thesecond case uses normal distribution. The first case demonstratesapplication of statistics in finance and the second case demonstratesapplication of statistics in operations management.
Write a 1,050-word report based on the Bell Computer Company Forecastsdata set and Case Study Scenarios. Case Study – Bell Computer CompanyThe Bell Computer Company is considering a plant expansion enabling thecompany to begin production of a new computer product. You have obtainedyour MBA from the University of Phoenix and, as a vice-president, youmust determine whether to make the expansion a medium- or large- scaleproject. The demand for the new product involves an uncertainty, whichfor planning purposes may be low demand, medium demand, or high demand.The probability estimates for the demands are 0.20, 0.50, and 0.30,respectively. Case Study – Kyle Bits and Bytes Kyle Bits and Bytes, aretailer of computing products sells a variety of computer-relatedproducts. One of Kyle’s most popular products is an HP laser printer.The average weekly demand is 200 units. Lead time (lead time is definedas the amount of time between when the order is placed and when it isdelivered) for a new order from the manufacturer to arrive is one week.If the demand for printers were constant, the retailer would re-orderwhen there were exactly 200 printers in inventory. However, Kyle learneddemand is a random variable in his Operations Management class. Ananalysis of previous weeks reveals the weekly demand standard deviationis 30. Kyle knows if a customer wants to buy an HP laser printer but hehas none available, he will lose that sale, plus possibly additionalsales. He wants the probability of running short (stock-out) in any weekto be no more than 6%. Include answers to the following: Case 1: BellComputer Company Compute the expected value for the profit associatedwith the two expansion alternatives. Which decision is preferred for theobjective of maximizing the expected profit? Compute the variation forthe profit associated with the two expansion alternatives. Whichdecision is preferred for the objective of minimizing the risk oruncertainty? Case 2: Kyle Bits and Bytes What should be the re-orderpoint? How many HP laser printers should he have in stock when here-orders from the manufacturer? Format your assignment consistent withAPA format.