Question

In: Advanced Math

A consumer electronics company is planning to introduce a new device. After careful consideration of costs,...

  1. A consumer electronics company is planning to introduce a new device. After careful consideration of costs, (e.g., there is a fixed cost of $5 million for developing the item),  the projected state of the economy, etc., the marketing manager came up with the following payoff table (in $millions)

Courses of action

Event

Market item

Do not market item

Introduction successful

$50

                -$5

Introduction not successful

-$40

-$5

  1. Calculate the regret table below. SHOW ALL WORK TO GET FULL CREDIT. (6 pts.)
  1. Calculate the minimax regret below. SHOW ALL WORK TO GET FULL CREDIT. (3 pts.)

Solutions

Expert Solution

Here I'm find regret table for these we choose each column largest number and substract from each number in that column respectively.and for minimax we find from regret table the minimum value in row maxima .For these we find row maxima.and then minimax .Both answers are below thank you.

Colby Messinger answered 3 years ago
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