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Oceans

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Submitted By cblum13
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Executive Summary
In the case of Ocean Carriers, protagonist Mary Linn must decide upon the best alternative regarding the building of a capesize carrier that a client has requested. Her choices in the matter include: 1) Building the ship and salvaging it after 15 years for a $5 million profit 2) Building the ship and keeping it in operation for its full 25 year operating life 3) Denying the request and not building the ship at all. Through my research I’ve found that the best decision for Mary Linn and Ocean Carriers would be to deny the request from the client due to steep potential losses that are likely to be incurred over the life of the ship. Problem, Opportunity, and Objectives In this case the protagonist, Mary Linn, must decide if building a new capesize carrier per request from a client will be a profitable venture for the Ocean Carriers shipping company. Opportunity/Problem | Cost | Anticipated Result | Through looking at the different approaches to this opportunity Mary Linn hopes to find a solution that will allow Ocean Carriers to generate the greatest amount of cash flow. | The cost in this situation is the amount of cash flow Ocean Carriers will receive, or not receive, depending on the approach they choose. | Mary Linn and Ocean Carriers will choose the solution that allows Ocean Carriers to make a profit. If a profit is not possible they will undoubtedly not proceed with the project. | Analysis of the Situation When making the decision on what to do in this case there are a number of very important factors that Mary Linn and the staff at Ocean Carriers will need to take into consideration. First off, they operate in an industry that is very much affected by the economy and the price of commodities. Over 85% of the cargo carried by capesizes is iron ore and coal which means in a good economy the need for capesizes rises

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