In the recent past, the production output has been between 10,000 and 20,000 units per week 75% of the time; however, it may fall below 10,000 or go above 20,000 more frequently in the future. The production manager wants to use E(output) to make a decision about upgrading automation softÂware. Identify at least two additional pieces of inÂformation that must be obtained or assumed to finalize the output information for this use.
What will be an ideal response?
Needed or assumed information to calculate an expected value:
1. Treat output as discrete or continuous variable
2. If discrete, center points on cells, e.g., 8000, 15,000, and 18,000 units per week
3. Probability estimates for < 10,000 and /or > 20,000 units per week
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