East West Distributing Is in the Process of Trying to Determine

question 8

Essay

East West Distributing is in the process of trying to determine where they should schedule next year's production of a popular line of kitchen utensils that they distribute.Manufacturers in four different countries have submitted bids to East West.However,a pending trade bill in Congress will greatly affect the cost to East West due to proposed tariffs,favorable trading status,etc.
After careful analysis,East West has determined the following cost breakdown for the four manufacturers (in $1,000's)based on whether or not the trade bill passes:

a.If East West estimates that there is a 40% chance of the bill passing,which country should they choose for manufacturing?
b.Over what range of values for the "bill passing" will the solution in part (a)remain optimal?

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Definitions:

Land Sale

A land sale involves the transaction where ownership of a piece of land is transferred from one party to another, typically involving legal documentation and financial compensation.

Loan Payoff

A payment or series of payments made to clear a loan's outstanding balance.

Original Purchase

The initial acquisition of an asset or item, often referring to the first time it was bought or the condition in which it was first obtained.

Stockholders' Equity

Stockholders' equity represents the residual interest in the assets of a corporation, after deducting its liabilities. It is also known as shareholders' equity.