Decision Making And Data Analysis

555 words - 3 pages

Campus Crucible

Campus Crucible is an R&D company that purchases inventions from campus-based researchers and companies who do not have the means or desire to further to develop them. Campus recruits its own scientific or engineering teams to develop the inventions for commercial use, and then sells or licences them to other companies. It is currently in negotiations to buy a new invention that could significantly reduce the energy consumption of traffic lights. The invention seems to be more promising than existing technologies aimed at doing the same thing, and if Campus can buy the invention and succeed in developing it, they could make a profit.

Based on what Campus knows about the invention, it is 50% likely to have commercial potential (i.e. to be better than currently available competing ...view middle of the document...

5 million exploration costs, and not the €1m development costs.

However, Campus could conduct preliminary testing on the invention before buying it, to get a better indication of its likelihood of having commercial potential. The inventor has agreed to allow Campus to do this, but the preliminary testing will take two weeks to conduct and there is a 5% chance that the inventor will sell the invention to another buyer in that time period. If the inventor doesn’t sell the invention to another buyer, Campus will still be able to buy it for €2 million.

The preliminary testing will give Campus a clearer understanding of whether the invention has commercial potential, but the testing is not perfectly accurate. If the testing shows a positive result, there is an 80% chance that the invention has commercial potential and a 20% chance that it has no commercial potential. If the testing shows a negative result, then there is only a 30% chance that the invention has commercial potential and a 70% chance that it has no commercial potential. The cost of the preliminary testing is €0.25 million. In Campus Crucible’s experience, such preliminary testing shows a positive result only 40% of the time: in other words, there is a 40% chance that the testing will return a positive result and a 60% chance that it will return a negative result.

Therefore the preliminary testing does not give absolute certainty that the invention will have commercial potential. If Campus bought the invention it would still need to go through the whole process of exploring the commercial potential and developing the invention as described and costed earlier.

Campus Crucible must decide whether to conduct the preliminary testing, and indeed whether to buy the invention at all. Draw a decision tree to represent the problem and indicate what Campus should do if their objective is to maximise expected value. You may disregard taxes, inflation and the time value of money.

Other Papers Like Decision Making And Data Analysis

Individual Ethical Decision-Making Analysis Introduction Throughout My Lifetime I Have Dealt With Everything From Priests To Murderers, I Have Witnessed Preachers With No Morals And Thieves With Moral...

732 words - 3 pages . These other two schools are necessary as well for the understanding of almost all things that are explainable. There is no one school that is better than the others and I would have to relate to all three of them. As for the things that are just phenomena I would have to agree with you in analyzing the facts and truths that we are able to prove and believe in rather than just making things up and believing in false truths. John Dewey you are truly

Team Paper

522 words - 3 pages can identify diminishing trends through the use of quarterly data analysis. Ratio analysis also helps to establish trends, and make financial comparisons that assist management in making healthy financial decisions. Also, ratio analysis identifies strengths and weaknesses within an organization that allows management to make strategic decisions that benefit the success of the operation. According to Wiley (2013), “Information from


442 words - 2 pages Organize and strengthen knowledge in each measurement tool for decision-making GB519: Learn to thoroughly examine decisions using measurement perspectives; immediately interpret the possible outcomes of decisions based on quantitative and qualitative values. GB519: The class text truly taught me a number of measurement concepts in decision-making including our ch. readings and assignments related to decision-tree analysis, forecasts, and pay

Theories Of Systems Analysis And Design For Integrated Business Solutions

1264 words - 6 pages modeling activities, as well as an ad hoc data analysis. The intelligence stage of the decision-making process entails the awareness of a problem at a symptomatic level; it necessitates a closer look at the problem and an evaluation of the variables and the relationships between different components. With more and better intelligence management increases the likelihood of designing a good decision. DSS can provide intelligence through

Business Management

984 words - 4 pages decision makers to consider values of attribute’s ranges in decision making and risk analysis process. In this method, actual weights of attributes are determined by dividing each value form the sum of all values. Swing weight method provides much more reliable results to decision maker as compared to assigning weights. In the case of optimal result, swing weight method is used to determine tradeoff weights by determining ranking of each of the

Big Data

1416 words - 6 pages accountants will be responsible for in accordance with the adoption of big data. * Develop methods for data valuation * Offer more specialized decision-making support through the use of big data * Identify and evaluate current and long term risks Each of the three items listed above presents both opportunities and challenges. Through the valuation of data asset, a company can increase their value of controls and help develop

21. Describe How Or Why Integer Programming Or Goal Programming Or Nonlinear Programming (Choose One) Might Be Used In A Real-World Business Situation. Be As Specific As You Can And Use Examples As...

1137 words - 5 pages their product can only be achieved through the internet. Decision Analysis is the method which is based on the use of quantitative decision making techniques for decisions where uncertainty exists and the outcomes are not known to managers. This technique is used to break the complicated methods or data into smaller chunks and then recombined after the data is refined to be used for the decision makers need. The most important goal of decision

Statistics In Business

488 words - 2 pages . The use of statistics helps determine the value of any proposed business endeavor (Lind, 2011). Managers use statistical data and analysis to control and predict employee production. When planning entry into a new market, statistics can be used to build business plans and marketing strategies. Statistics aid in managerial decision-making in all departments from accounting, production, to marketing. Without a full understanding of the

The Research Process

2274 words - 10 pages Chapter 04The Research Process CHAPTER LEARNING OBJECTIVES AFTER READING THIS CHAPTER, STUDENTS SHOULD UNDERSTAND… 1. Research is decision and dilemma centered. 2. The clarified research question is the result of careful exploration and analysis, and sets the direction for the research project. 3. How budgeting and value assessments influence the process for proposing research and, ultimately, research design. 4

Decision Support

1971 words - 8 pages who initially used DSS for successful decision were able to achieve the same result when not using DSS. The DSS requires additional IT budget which some firms may consider being expensive (Haitham, 2015).The decision support system requires investing in information system to collect data from many sources and analyze them to support the decision making. Customization of the system may attract higher cost. An organization on a tight budget

Political Micro Targeting & Ten Tribes

912 words - 4 pages , magazine subscriptions, and mortgage balance. Data could even indicate whether the voter has dogs or cats. (Cat owners lean slightly for Democrats, dog owners trend Republican.) After the analysis, the voter is placed into a political tribe, and analysts can draw conclusions about the issues that matter to him or her and make campaign decision accordingly. Is it a bad thing? Behavioral Grouping For generations, governments lacked the means to

Related Essays

Judgment And Decision Making Essay

462 words - 2 pages Abstract 1.5(297) Looking up and looking around Management process includes decision making where authority and advancement patterns meet and is existing in every corporation. Two ideas implemented in decision making: * Consensus manager: person achieving a communally defined goal skillfully. * Take charge guy: Person achieving in a determined way by exciting and dynamic leadership. Decision making is necessarily, thoroughly and

Re Organization And Layoff: Decision Making Evaluation Paper

855 words - 4 pages Re-organization and Layoff: Decision Making Evaluation Paper PHL/320-Critical Thinking and Decision Making July 20, 2015 Re-organization and Layoff: Decision Making Evaluation Paper The term “working poor” aptly describes most employees in the middle income tax bracket. Middle class Americans typically live paycheck to paycheck. These workers face difficulty saving money as incomes barely cover living expenses

Examination Of Leadership To Determine A Direct Correlation Between Leadership Style And Ethical Decision Making

3994 words - 16 pages and style, an analysis by the author will determine if a direct correlation exists between leadership style and ethical decision making. The study of leadership is as debated a topic as any in any philosophical fields. The word "leadership" has many definitions and is as abstract as the words love, democracy, freedom, and peace. Given the various interpretations of the word leadership, most concede a good working definition of leadership is

1. Perform A Quantitative Insourcing/Outsourcing Analysis Using The Data Provided. What Qualitative Issues Might Affect Your Final Decision? Identify Any Costs Or Issues That Are Not Part Of Your...

4548 words - 19 pages analysis involves gathering reliable data. Discuss the various groups that should be involved when conducting an insourcing/outsourcing analysis such as the one presented in this case. What information can each of these groups provide? 5. Discuss the major issues associated with an insourcing/outsourcing analysis and decision. Appendix 1 Year One Inventory Carrying Charges Outsourcing Option