Calculate the expected values of all alternatives

Assignment Help Operation Management

Reference no: EM13105066

For the payoff table below, the decision maker will use P(s1) = .15, P(s2) = .5, and P(s3) = .35.

State of Nature

Decision	s1	s2	s3
d1	-5,000	1,000	10,000
d2	-15,000	-2,000	40,000

a. Calculate the expected values of all alternatives. What alternative would be chosen according to expected value?

b. For a lottery having a payoff of 40,000 with probability p and -15,000 with probability (1-p), the decision maker expressed the following indifference probabilities.

Payoff	Probability
10,000	.85
1,000	.60
-2,000	.53
-5,000	.50

c.
Calculate the Expected Utility for all alternatives

d. What alternative would be chosen according to expected utility?

Reference no: EM13105066

Questions Cloud

Possible cost drivers for aircraft manufacturing firm : ABC Airlines has calculated the total costs (fixed and variable) for the passenger service flights between Los Angeles, California and Orlando, Florida. The two methods used were the high-low method and the least squared method.

Make the class employee to initializes three data members : Make the class called Employee which comprises three pieces of information as data membersa first name (type string), last name (type string) and monthly salary (type int).

Research different types of cultures : You are required to research different types of cultures in relation to Computing and IT: gaming culture, internet culture, and the impact that one culture of your choice has on the communication processes.

Determine the value of the game : Consider the following two-person zero-sum game. Assume the two players have the same two strategy options. The payoff table shows the gains for Player A.

Calculate the expected values of all alternatives : For the payoff table below, the decision maker will use P(s1) = .15, P(s2) = .5, and P(s3) = .35. Calculate the expected values of all alternatives. What alternative would be chosen according to expected value?

Test vlaue in the noncritical region : Doctors nationally believe that 68% of a certain type of operation are successful. In a particular hospital 47 of these operations were observed and 37 of them were successful. At a = 0.05 is this hospital's success rate different from the nationa..

Compute expected utility of decision alternatives : Mark M. Upp has just been fired as the university bookstore manager for setting prices too low (only 20 percent above suggested retail). He is considering opening a competing bookstore near the campus.

Explain statistical analysis you will need to perform : Elaborate in details illustrate what type of data are you going to collect, (quantitative and qualitative). Explain statistical analysis you will need to perform related to the outcome of focus groups.

Explain the data collection methods used in research project : Explain the data collection methods used in the research project. Illustrate what did the researchers conclude as a result of their research?

User Account

All Pages