Question
In: Advanced Math
The following is a payoff table giving costs for various situations. What decision would an optimist...
The following is a payoff table giving costs for various situations. What decision would an optimist make?
| State 1 | State 2 | State 3 | |
| Alternative 1 | 45 | 37 | 83 |
| Alternative 2 | 16 | 59 | 72 |
| Alternative 3 | 23 | 65 | 91 |
| Alternative 4 | 44 | 33 | 55 |
Solutions
Colby Messinger answered 1 year agoRelated Solutions
1. the following is a payoff table giving profits for various situations. states of nature ......
1. the following is a payoff table giving profits for various
situations. states of nature ... Question: 1. The following is a
payoff table giving profits for various situations. &nb... 1.
The following is a payoff table giving profits for various
situations. States of Nature Alternatives A B C Alt-ve 1 100 120
180 Alt-ve 2 120 140 120 Alt-ve 3 200 100 50 Do Nothing 0 0 0 1. If
a person were to use the expected monetary value...
The following is a payoff table giving profits for various situations. States of Nature Alternatives A...
The following is a payoff table giving profits for various
situations.
States of Nature Alternatives A B C D
Alternative 1 120 140 170 160
Alternative 2 210 130 140 120
Alternative 3 120 140 110 190
Do Nothing 0 0 0 0
a. What decision would a pessimist make?
b. What decision would an optimist make?
c. What decision would be made based on the realism criterion,
where the coefficient of realism is 0.60?
d. What decision would be...
Consider the following payoff table giving profits for various situations: States of Nature Alternatives A B...
Consider the following payoff table giving profits for various
situations: States of Nature Alternatives A B C ALT 1 120 140 120
ALT 2 200 100 50 ALT 3 100 120 180 Do nothing 0 0 0 probability .3
.5. .2 Solve the following problems based on above payoff table 1.
If a person were to use the expected monetary value criterion
(EMV), what decision would be made? A) Alternative 1 B) Alternative
2 C) Alternative 3 D) Do Nothing...
Under what conditions is a decision tree preferable to a decision/payoff table? In what types of...
Under what conditions is a decision tree preferable to a
decision/payoff table?
In what types of situations would it be more appropriate to use
a utility framework for decision making rather than an expected
monetary value framework? Give an example.
The following payoff table shows profit for a decision analysis problem with two decision alternatives and...
The following payoff table shows profit for a decision analysis
problem with two decision alternatives and three states of
nature.
Decision
Alternative
States of Nature
s1
s2
s3
d1
240
90
15
d2
90
90
65
Suppose that the decision maker obtained the probabilities
P(s1) = 0.65,
P(s2) = 0.15,
and
P(s3) = 0.20.
Use the expected value approach to determine the optimal
decision.
EV(d1) = EV(d2) = The
optimal decision is ? d₁ d₂
Which of the following situations can lead to the IRR rule giving the same decision as...
Which of the following situations can lead to the IRR rule
giving the same decision as the NPV rule?
You are given the following payoff table with profits (in $). Decision Alternative States of Nature...
You are given the following payoff table with profits
(in $).
Decision
Alternative
States of Nature
s1
s2
d1
1000
3000
d2
4000
500
Assume the following probability information is given,
where I1 and I2 are the outcomes of the sample information
available:
P(s1) = 0.45;
P(I1 | s1) = 0.7;
P(I2 | s1) = 0.3
P(s2) = 0.55;
P(I1 | s2) = 0.6;
P(I2 | s2) = 0.4
[2] Find the values of P(I1) and P(I2).
[2] Determine the...
The following payoff table shows the profit for a decision problem with two states of nature...
The following payoff table shows the profit for a decision
problem with two states of nature and two decision
alternatives:
State of Nature
Decision Alternative
s1
s2
d1
10
1
d2
7
3
(a)
Suppose P(s1)=0.2 and
P(s2)=0.8. What is the best decision
using the expected value approach? Round your answer in one decimal
place.
The best decision is decision alternative (- Select
your answer -d1 /d2) with an expected value of.
(b)
Perform sensitivity analysis on the payoffs for...
The following payoff table shows the profit for a decision problem with two states of nature...
The following payoff table shows the profit for a decision
problem with two states of nature and two decision
alternatives:
State of Nature
Decision Alternative
s 1
s 2
d 1
6
3
d 2
9
1
Use graphical sensitivity analysis to determine the range of
probabilities of state of nature s 1 for which each of
the decision alternatives has the largest expected value. If
required, round your answers to two decimal places.
d1 is optimal for probability of...
1.in which of the following situations would you prefer to be giving a loan ? a...
1.in which of the following situations would you prefer to be
giving a loan ?
a interest rate 4 inflation 1 %
b interest rate 9 inflation 7%
c interest rate 3 inflation 4%
d interest rate 8 inflation 2
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