Option Low Moderate High Hire $ (250,000) $ 100,000 $ 625,000 Subcontract $ 100,000 $ 150,000...

Option Low Moderate High

Hire $ (250,000) $ 100,000 $ 625,000

Subcontract $ 100,000 $ 150,000 $ 415,000

Do Nothing $ 50,000 $ 80,000 $ 30,000

Demand Low Moderate High

Probabilities 25% 50% 25%

I need help answering the following questions using the payoff matrix above.

a) Determine the decision based on Maximin

b) Determine the decision based on Maximax

c) Determine the decision based on the expected monetary value (EMV).

d) Determine the decision based on Minimax Regret

e) Determine the decision based on expected opportunity loss (EOL).

f) Determine the expected value of perfect information (EVPI)

Solutions

Expert Solution

orchestra answered 1 year ago

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