Reference no: EM131167341
A television network earns an average of $1.6 million each season from a hit program and loses an average of $400,000 each season on a program that turns out to be a flop. Of all programs picked up by this network in recent years, 25% turn out to be hits and 75% turn out to be flops.
At a cost of C dollars, a market research firm will analyze a pilot episode of a prospective program and issue a report predicting whether the given program will end up being a hit.
If the program is actually going to be a hit, there is a 90% chance that the market researchers will predict the program to be a hit.
If the program is actually going to be a flop, there is only a 20% chance that the market researchers will predict the program to be a hit.
a. Assuming that C = $160,000, find the strategy that maximizes the network's expected profit.
b. What is the maximum value of C that the network should be willing to pay the market research firm?
c. Calculate and interpret EVPI for this decision problem.
|
How might the presence of an externality be in part
: Despite the city's positive response to the coffee shop's renovation, other businesses in the area have not followed suit in renovating the many decrepit buildings and abandoned lots. How might the presence of an externality be in part the cause o..
|
|
Multinomial distribution and the chi-squared test
: Consider dealing a hand of 3 cards from a well shuffled standard deck of playing cards. Let X1 be the number of eights in the hand; let X2 be the number of nines in the hand; and let X3 be the number of cards in the hand that are neither eights nor n..
|
|
How the information you learned and evaluated in developing
: How the information you learned and evaluated in developing one of your Action Plans will impact the way you view and support the children and families with whom you work?
|
|
Calculate the average product of labor
: Consider the production function f(L, K) = 2LK + 5K1/3, where L is the amount of labor and K is the amount of capital. Calculate the average product of labor and the marginal product of capital. Is the marginal product of capital diminishing
|
|
Calculate and interpret evpi for this decision problem
: What is the maximum value of C that the network should be willing to pay the market research firm?-Calculate and interpret EVPI for this decision problem.
|
|
Which parts scenes and subplots would you cut
: Respond to the following question/prompt: "Hamlet, though often ranked as one of Shakespeare's greatest works, is an exceptionally long play, and cuts are often made while staging it. If you were editing this play, either for publication for for p..
|
|
Reference an article discussing mortgage rates
: After reviewing the first few chapters of your textbook Money and Banking , write a short paper on how your life is affected by the financial system. Find at least two online sources to support your position. For example, you can reference an article..
|
|
Degree of a vertex represent in the acquaintanceship graph
: What do isolated and pendant vertices in this graph represent? In one study it was estimated that the average degree of a vertex in this graph is 1000. What does this mean in terms of the model?
|
|
Compute and interpret the evpi
: does Sharp Outfits minimize its expected total cost by choosing to postpone shipping its customer orders via UPS?- compute and interpret the EVPI when p = 0.15.
|