<p>Even though independent gasoline stations have been having a difficult time, Susan Solomon has been thinking about starting her own independent gasoline station. Susan's problem is to decide how large her station should be. The annual returns will depend on both the size of her station and a number of marketing factors related to the oil industry and demand for gasoline. After a careful analysis, Susan develop the following table: </p><table><thead><tr class="firstRow"><th style="text-align: left;">Size of first station</th><th style="text-align: center;">GOOD MARKET ($)</th><th style="text-align: center;">FAIR MARKET ($)</th><th style="text-align: center;">POOR MARKET ($)</th></tr></thead><tbody><tr><td>Small</td><td style="text-align: center;">50,000</td><td style="text-align: center;">20,000</td><td style="text-align: center;">-10,000</td></tr><tr><td>Medium</td><td style="text-align: center;">80,000</td><td style="text-align: center;">30,000</td><td style="text-align: center;">-20,000</td></tr><tr><td>Large</td><td style="text-align: center;">100,000</td><td style="text-align: center;">30,000</td><td style="text-align: center;">-40,000</td></tr><tr><td>Very large</td><td style="text-align: center;">300,000</td><td style="text-align: center;">25,000</td><td style="text-align: center;">-160,000</td></tr></tbody></table><p>For example, if Susan constructs a small station and the market is good, she will realize a profit of $50,000. </p><p>a) Develop a decision table for this decision </p><p>(b) What is the maximax decision? </p><p>(c) What is the maximin decision? </p><p>(d) What is the equally likely decision? </p><p>(e) What is the criterion of realism decision? Use an α value of 0.8. </p><p>(f) Develop an opportunity loss table. </p><p>(g) What is the minimax regret decision?</p>

Question

In: Math

Even though independent gasoline stations have been having a difficult time

Even though independent gasoline stations have been having a difficult time, Susan Solomon has been thinking about starting her own independent gasoline station. Susan's problem is to decide how large her station should be. The annual returns will depend on both the size of her station and a number of marketing factors related to the oil industry and demand for gasoline. After a careful analysis, Susan develop the following table:

Size of first station	GOOD MARKET ($)	FAIR MARKET ($)	POOR MARKET ($)
Small	50,000	20,000	-10,000
Medium	80,000	30,000	-20,000
Large	100,000	30,000	-40,000
Very large	300,000	25,000	-160,000

For example, if Susan constructs a small station and the market is good, she will realize a profit of $50,000.

a) Develop a decision table for this decision

(b) What is the maximax decision?

(d) What is the equally likely decision?

(e) What is the criterion of realism decision? Use an α value of 0.8.

(f) Develop an opportunity loss table.

(g) What is the minimax regret decision?

Solutions

Expert Solution

milcah answered 1 year ago

Next > < Previous

Related Solutions

Even though independent gasoline stations have been having a difficult time, lan Langella has been thinking...

Even though independent gasoline stations have been having a difficult time, lan Langella has been thinking about starting his own independent gasoline station. Ian's problem is to decide how large his station should be. The annual returns will depend on both the size of his station and a number of marketing factors related to the oil industry and demand for gasoline. After a careful analysis, lan developed the following table: States of NatureSize of First StationGood MarketFair MarketPoor MarketSmall$60,000$21,000-$12,000Medium$70,000$32,000-$18,000Large$95,000$32,500-$42,000Very Large$280,000$24,000-$150,000For example,...

Explain why, even though the rules guaranteeing access have been enhanced, it's still difficult for patients...

Explain why, even though the rules guaranteeing access have been enhanced, it's still difficult for patients to access their health data and how do the finalized CMS and ONC rules enhancing patient access affect how organizations manage healthcare information. Pay special attention to include the expanded use of health data apps, mobile access to healthcare information, and the concepts of information blocking and data withholding. please answer in two pages thanks in advance

The CPA-auditor is required to be INDEPENDENT (even though the accounting firm is paid by the...

The CPA-auditor is required to be INDEPENDENT (even though the accounting firm is paid by the corporation). In contrast, the CPA-tax accountant (or attorney) is an ADVOCATE of the client (not a spokesperson for the IRS). Please discuss the legal, ethical, and pragmatic distinctions between these two conflicting positions. Support your comments using Circular 230 and the AICPA Code of Professional Conduct.

Even though the mills in Manchester, formally important for processing wool, have been inactive for over...

Even though the mills in Manchester, formally important for processing wool, have been inactive for over a hundred years, what bacteria might still be present in the spores in the soil? What disease would it cause?

Credit cards are not considered as money even though people have been using them like money...

Credit cards are not considered as money even though people have been using them like money for many years. Explain. What is/are the difference(s) between a debit card and a credit card. Give relevant example(s) in Hong Kong. If you pay in virtual currencies such as bitcoin, do you think it is regarded as money according to traditional definitions?

Even though strychnine can easily be isolated from the Nux Vomicus tree, chemists have been working...

Even though strychnine can easily be isolated from the Nux Vomicus tree, chemists have been working on the problem of synthesizng strychnine in the laboratory since the 1950s. As of 2012, the molecule had been synthesized using 17 different strategies. Please comment on the motivation for all of this research- why did chemists originally want to synthesize strychnine? Why did chemists continue to pursue strychnine synthesis research years after it had been done the first time? Should chemists still be...

Vaccines against polio are among the greatest achievements in medicine of our time. Even though there...

Vaccines against polio are among the greatest achievements in medicine of our time. Even though there are 2 vaccines against the pathogen, only one is given to humans in the US and the other one in the developing world. Explain the difference between the 2 polio vaccines and argue why one was chosen over the other (compare risks and benefits). Will we be able to eradicate polio in the near future? Defend your answer.

Nurse Fatma recently saw that the patient, who was having a difficult time due to the...

Nurse Fatma recently saw that the patient, who was having a difficult time due to the death of her mother and brother, had sent her a friend request from Facebook after her discharge. Nurse Fatma approved the friendship request and gave her friend support in the grieving process she was experiencing due to her loss. is this right or wrong? why , why not?

I'm having a pretty difficult time with these types of problems and I'd really appreciate it...

I'm having a pretty difficult time with these types of problems and I'd really appreciate it if someone could show me how to go about doing this one, thank you! 1. Consider the population of {32, 34, 37, 39} a) Find the mean, variance, and standard deviation b) Suppose the sample size n=2 is randomly chosen with replacement from this population, List the 16 possible samples of size n=2 c) Fill out the table Sample Size (n=2) Sample Mean Sample...

It is important to recognize that even though a male might have adequate sperm production in...

It is important to recognize that even though a male might have adequate sperm production in the testes, depletion of the reserves in the cauda epididymis can occur rapidly. From a practical standpoint, how many females can a animal male service in a day? Explain your reasoning.

Subjects