Use the Following Data to Answer Questions 88-100 -Refer to the Data on Expected Demand for Weston Gadgets,Inc

question 57

Multiple Choice

Use the following data to answer questions 88-100. $$\begin{array}{l} \quad \quad \quad \quad \quad \quad \quad \quad \text { Expected Demand for Weston Gadgets, Inc. }\\\begin{array} { | l | l | l | l | } \hline \text { Decision Alternative } & \text { Low 35\% } & \text { Medium 30\% } & \text { High 35\% } \\\hline \text { Outsource } & \$ 16.00 \text { million } & \$ 28.00 \text { million } & \$ 66.00 \text { million } \\\hline \text { Build capacity } & \$ 4.00 \text { million } & \$ 32.00 \text { million } & \$ 26.00 \text { million } \\\hline \text { Do nothing } & \$ 9.00 \text { million } & \$ 18.00 \text { million } & \$ 66.00 \text { million } \\\hline\end{array}\end{array}$$
-Refer to the data on Expected Demand for Weston Gadgets,Inc.For the various demand scenarios and their associated probabilities,the option to build has an expected value of ______.

• A)$37.10 million
• B)$26.71 million
• C)$20.10 million
• D)$17.85 million

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Definitions:

Decentralization

The degree to which the authority to make decisions is given to lower levels in an organization’s hierarchy.

Hierarchy of Authority

A system in organizations where individuals are ranked according to their roles and responsibilities, establishing a clear line of command from top to bottom.

Formal Structure

The officially designated arrangement of roles and responsibilities within an organization, typically outlined in organizational charts and documents.

Unity of Command

A principle stating that each employee should report to one and only one manager to avoid confusion and conflict.