A decision maker faced with four decision alternatives and four states of nature develops the following profit payoff ta

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A decision maker faced with four decision alternatives and four states of nature develops the following profit payoff ta

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A Decision Maker Faced With Four Decision Alternatives And Four States Of Nature Develops The Following Profit Payoff Ta 1
A Decision Maker Faced With Four Decision Alternatives And Four States Of Nature Develops The Following Profit Payoff Ta 1 (29.25 KiB) Viewed 11 times
A decision maker faced with four decision alternatives and four states of nature develops the following profit payoff table. Decision Alternative d₁ d₂ d₂ States of Nature 51 52 53 54 13 8 9 4 10 9 8 9 7 7 EV(d₂) EV(d₂) EV(d₂) EV(d₂) The optimal decision is ? 6 9 10 10 12 The decision maker obtains information that enables the following probabilities assessments: P(s) - 0.5, P(5₂) = 0.2, P(s) 0.2, and P(s) = 0.1. (a) Use the expected value approach to determine the optimal decision. (b) Now assume that the entries in the payoff table are costs. Use the expected value approach to determine the optimal decision. The optimal decision is?
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