A plastic Manufacturing company produces plasticchairs. The company suspects the present trend towards stronger andsimpler chairs will last for a long time. The Company musttherefore decide among four alternatives of providing foranticipated higher demand.
The alternatives are:
– Completely overhauling the existing plant and installing computeroperated plastic producing machines
– Expanding the current plant by adding more machines
– Buying a competitor’s plant which is on sale
– Limit production to the current plant capacity.
The payoff table is shown below :
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