Reference no: EM13989852
Bradley Architectural, a primarily residential architectural firm, was just notified of an urgent request for a development proposal on a property. They are almost certain that the proposal will go to a competitor, who has been involved with the project since the beginning, but they have 2 days to bring their ideas to the table if they wish to. They are trying to decide what they should propose, if anything. Can you determine what choice they should nake using the Hurwicz at alpha=0.05 and a =0.1, to represent their pessimism about winning the contract. What are the exoected values? What choice should they make if they thought they had an equal chance of winning? What would be the expected value?
Decision Win Contract Lose Contract
Business proposal $2,542,000 -$24,600
Mixed proposal $2,316,000 -$20,950
Residential proposal $2,150,000 -$2,000
No proposal $0 $0
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