Business Modelling For Decision Making

The Faculty of Business and Law

Business Modelling for Decision Makers

Assignment code：APC310

Student name：Lin Yu

Student ID:109053367

Submission date:13 August,2012

Moderators: Rob Hall and Jeff Evans

Contents

Introduction (2)

Question 1 (2)

Section A (2)

Section B (6)

Question 2 (9)

Section A (9)

Section B (11)

Conclusion (12)

Reference (13)

Introduction

As a business manager, there are a numbers of factors and probabilities which are necessary to take consideration before making decisions. Mangers need to do some theoretical analysis to support decisions that he or she makes. Today, there are many analysis tools and applications that can be used to analyze data and making decisions, such as the decision trees, linear programming, discrete simulation and so on (Curwin, 2011). By using these tools, managers can make their decisions more effectively; minimize negative side of risk, facilitate business in order to achieve the maximum profits.

Question 1

Section A

1.1 Analyzing the data we have collected.

From data, we can know the approximate time of making each range of coffee and the probability of choosing each range of coffee; it is shown in the following table.

The table shows that consumers more prefer to select the regular coffee and the probability of selection is 0.4. It only takes one minute to make one regular coffee. The most time effective type of coffee is Espresso, it is made in 0.5 minute. But the probability of selection of this type is relatively low, which is only 0.1. The most time consuming type of coffee is Cappuccino, it needs 2.3 minutes to be made. The

probability of selection is relatively low compared with the regular and Espresso. Assuming that the profit rate of selling each type of coffee is equal, then we can get the cost of each type of coffee from the time consuming circumstances. Finally, we can know what kind of combination could generate the maximum profit for the business owner.

Putting the types of coffee in the order of cost consideration, from the highest cost to the lowest cost; we can get Cappuccino, Mocha, Latte, Regular and Espresso.

The table below presents us information of the probabilities Customer inter-arrival interval times. Putting the inter-arrival times in the order of probability consideration, from the highest to the lowest, we can get 30 sec, 1 minute, 2 minutes, 3 minutes and 4 minutes.

1.2 Set up a discrete simulation for 15 customers

Customer Arrivals