Questions from Spreadsheet Modeling

Q: This chapter presented the problem of having to decide between two job

This chapter presented the problem of having to decide between two job offers. The decision maker could accept the job with company A, accept the job with company B, or reject both offers and hope for...

Q: Refer to the previous question. Morley Properties can hire a consultant

Refer to the previous question. Morley Properties can hire a consultant to predict the most likely level of demand for this project. This consultant has done many similar studies and has provided Morl...

Q: Benjamin Franklin once said, “In this world nothing is certain

Benjamin Franklin once said, “In this world nothing is certain but death and taxes.” Although that may be true, there is often great uncertainty involved in when on...

Q: Refer to question 9. Suppose that the utility function for the

Refer to question 9. Suppose that the utility function for the owner of Morley Properties can be approximated by the exponential utility function: where the risk tolerance value R 5 100 (in $1,000s)...

Q: Refer to question 10. Suppose that the consultant’s fee is $

Refer to question 10. Suppose that the consultant’s fee is $5,000 and the utility function for the owner of Morley Properties can be approximated by the exponential utility function...

Q: The Tall Oaks Wood Products Company is considering purchasing timberland for $

The Tall Oaks Wood Products Company is considering purchasing timberland for $5 million that would provide a future source of timber supply for the company’s operations over the next 10 years. Alterna...

Q: Medical studies have shown that 10 out of 100 adults have heart

Medical studies have shown that 10 out of 100 adults have heart disease. When a person with heart disease is given an EKG test, a 0.9 probability exists that the test will indicate the presence of hea...

Q: A manufacturer has two machines that make the same parts for diesel

A manufacturer has two machines that make the same parts for diesel truck engines. One machine is 5 years older than the other one. The older machine runs slower and makes 35% of the parts, of which 8...

Q: Bill and Ted are going to the beach with hopes of having

Bill and Ted are going to the beach with hopes of having an excellent adventure. Before going, they read a report by the world’s leading authority on tiger shark behavior indicating that when a tiger...

Q: Microproducts, Incorporated (MPI) manufactures printed circuit boards for a

Microproducts, Incorporated (MPI) manufactures printed circuit boards for a major PC manufacturer. Before a board is sent to the customer, three key components must be tested. These components can be...