The Board of Directors of Bidwell Valve Company Has Made

question 39

Short Answer

The Board of Directors of Bidwell Valve Company has made the following estimates for the upcoming year's annual earnings:
P(earnings lower than this year) = .30
P(earnings about the same as this year) = .50
P(earnings higher than this year) = .20
After talking with union leaders, the human resource department has drawn the following conclusions:
P(Union will request wage increase | lower earnings next year) = .25
P(Union will request wage increase | same earnings next year) = .40
P(Union will request wage increase | higher earnings next year) = .90
a. Calculate the probability that the company earns the same as this year and the union requests a wage increase.
b. Calculate the probability that the company has higher earnings next year and the union does not request a wage increase.
c. Calculate the probability that the union requests a wage increase.

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Definitions:

CEO

The Chief Executive Officer, the highest-ranking individual in a company, responsible for making major corporate decisions.

Enterprise Resource Planning

Integrated management software systems designed to automate and streamline core business processes, enhancing efficiency and decision-making across an organization.

Strategic Business Unit Level

A distinct part of a larger corporation, focused on a specific strategic objective or market sector.

Targeted Customers

A specific group of consumers identified as the primary audience for a product or service, based on shared characteristics or needs.