Develop a risk matrix on the dimensions of: expected cost (categories <$1.5/unit, $1.5/unit to $2.5/unit, and >$2.5/unit)
Probability{OK} (categories >0.9, 0.7 to 0.9, < 0.7)
Categorize the ten vendors below
         Pr{Product failure} Pr{Firm failure} Pr{Political failure}    Expected cost ($)
China A       0.1                         0.15                   0.05                            1.07
China B       0.09                      0.15                   0.05                            1.10
China C       0.07                      0.13                   0.05                            1.20
Taiwan          0.01                      0.01                   0.1                               1.40
Vietnam       0.15                      0.25                   0.05                            0.93
Germany       0.01                      0.02                   0.01                            2.88
Iceland          0.03                      0.1                      0.2                               4.24
Michigan       0.02                      0.2                      0.03                            2.4
California       0.01                      0.25                   0.03                            3.85
Alabama       0.03                      0.2                   0.03                               2.3
• If expected cost is in the best category and Prob{OK} is not in the worst category, pursue a contract
• If expected cost is in the best category and Prob{OK} is in the worst category, negotiate to improve probabilities
• If expected cost is in the intermediate category and Prob{OK} is in the best category, pursue a contract
• If expected cost is in the intermediate category and Prob{OK} is in the intermediate category, negotiate to improve costs and probabilities
• If expected cost is in the worst category and Prob{OK} is in the best category, negotiate to improve cost
• Otherwise avoid the vendor
Report the categorization for each of the 10 vendors.

Develop a risk matrix on the dimensions of: expected cost (categor...