Neuron is going to produce a new mini budget vehicle, an Atomic, and wants to determine the amount of annual capacity it

[answerhappygod]

Neuron Is Going To Produce A New Mini Budget Vehicle An Atomic And Wants To Determine The Amount Of Annual Capacity It 1 (79.85 KiB) Viewed 63 times

Neuron is going to produce a new mini budget vehicle, an Atomic, and wants to determine the amount of annual capacity it should build. Neuron's goal is to maximize the profit from this vehicle over the next five years. Each vehicle will sell for RM19,000 and incur a variable production cost of RM16,00. Building one unit of annual capacity will cost RM2000. Each unit of capacity will also cost RM1000 per year to maintain, even if the capacity is unused. Demand for the Atomic is unknown but marketing estimates the distribution of annual demand to be as shown in the file P06_46.xlx. Assume that the number of units sold during a year is the minimum of capacity and annual demand. Which capacity level should Neuron choose? Do you think EMV is the appropriate criterion? Discuss detail for above situation based on the decision tree.