Expert answer:Expansion Strategy and Establishing a Re-Order Poi

Solved by verified expert:Resources: Microsoft Excel®, Bell Computer Company Forecasts data set, Case Study Scenarios Write a 250-word report based on the Bell Computer Company Forecasts data Attached. Include answers to the following: Case 1: Bell Computer CompanyCompute the expected value for the profit associated with the two expansion alternatives. Which decision is preferred for the objective of maximizing the expected profit?Format your assignment consistent with a managerial report.Note: pay special attention to your reporting, even of an excel sheet. Treat it as a report you are submitting to a coleague or supervisor who is infinitely ignorant and infinitly intelligent. Do not let the reader “pick and choose” the relevant parts. Include only what is relevant, in a crystal clear fashion.
bell_computer_company_forecasts.xlsx

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Medium-Scale
Expansion Profits
Low
Demand Medium
High
Annual
Profit
($1000s)
50
150
200
Large-Scale
Expansion Profits
Annual
Profit
P(x) ($1000s)
20%
0
50%
100
30%
300
P(x)
20%
50%
30%
Expected Profit ($1000s)
Risk Analysis for Medium-Scale Expansion
Annual Profit
(x)
Probability
P(x)
(x – µ)2 (x – µ)2 * P(x)
Demand $1000s
(x – µ)
Low
50
20%
Medium
150
50%
High
200
30%
σ2 =
σ=
Risk Analysis for Large-Scale Expansion
Annual Profit
(x)
Probability
P(x)
(x – µ)2 (x – µ)2 * P(x)
Demand $1000s
(x – µ)
Low
0
20%
Medium
100
50%
High
300
30%
2
σ =
σ=

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