A Company Is About to Select a Vendor for the Outsourcing

question 53

Essay

A company is about to select a vendor for the outsourcing of all of its office supplies. It has identified four criteria critical to the selection. These criteria, and their importance weights, appear below. The score for each site is listed below. Which vendor has the highest composite score?
$$\begin{array} { | l | r | r | r | r | } \hline & \text { Weight } & \text { Vendor 1 } & \text { Vendor 2 } & \text { Vendor 3 } \\\hline \text { Factor 1 } & 0.34 & 7 & 8 & 8 \\\hline \text { Factor 2 } & 0.45 & 4 & 7 & 1 \\\hline \text { Factor 3 } & 0.07 & 2 & 6 & 2 \\\hline \text { Factor 4 } & 0.14 & 3 & 4 & 4 \\\hline\end{array}$$

Relate the concepts of risk, probability, and expected value in the context of decision-making under uncertainty.

Understand the concept of expected value and its application in decision-making.

Calculate expected gains or losses in various business and game scenarios.

Differentiate between random variables and their characteristics.

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Definitions:

Terminating Decimal

A decimal fraction that has a finite number of digits after the decimal point.

Five-Figure Accuracy

A level of precision in numerical calculations or measurements where the result is accurate to five digits.

Four-Figure Accuracy

A level of precision in numerical representations where the number is rounded or truncated to four significant digits.

Terminating Decimal

A decimal characterized by a restricted amount of digits after the decimal point.