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  • 2.12 Decisions - With - Discrete - Random - Variables - Part - 2

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    Carlos Andre Payares Luna
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    This document recommends leasing Machine Y over Machine X based on higher expected profit of $34,500 compared to $31,000 for Machine X and lower standard deviation of profit of $3,500 for Machine Y versus $10,440.31 for Machine X, indicating Machine Y has lower risk.

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    2.12 Decisions_with_Discrete_Random_Variables_-_Part_2

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    This document recommends leasing Machine Y over Machine X based on higher expected profit of $34,500 compared to $31,000 for Machine X and lower standard deviation of profit of $3,500 for Machine Y versus $10,440.31 for Machine X, indicating Machine Y has lower risk.

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    © All Rights Reserved
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    8 views1 page

    2.12 Decisions - With - Discrete - Random - Variables - Part - 2

    Uploaded by

    Carlos Andre Payares Luna
    This document recommends leasing Machine Y over Machine X based on higher expected profit of $34,500 compared to $31,000 for Machine X and lower standard deviation of profit of $3,500 for Machine Y versus $10,440.31 for Machine X, indicating Machine Y has lower risk.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Recommendation

    𝑬 𝑿 = $𝟑𝟏, 𝟎𝟎𝟎 𝑬 𝒀 = $𝟑𝟒, 𝟓𝟎𝟎


    𝑽 𝑿 = 𝟏𝟎𝟗, 𝟎𝟎𝟎, 𝟎𝟎𝟎 𝑽 𝒀 = 𝟏𝟐, 𝟐𝟓𝟎, 𝟎𝟎𝟎
    𝑺 𝑿 = $𝟏𝟎, 𝟒𝟒𝟎. 𝟑𝟏 𝑺 𝒀 = $𝟑, 𝟓𝟎𝟎

    • Lease the Machine!


    • Higher expected profit
    • Lower standard deviation of profit
    – Lower risk

    Bond Business School Data Analytics for Decision Making – Topic 2d 1

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