What is the maximin decision

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Reference no: EM132535237

Independent gasoline stations have been having a difficult time, nevertheless, Anna Li has been thinking about starting her own independent gasoline station. Anna'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, Anna developed the following table of the profit (or loss) realized for each size station based on market conditions

SIZE OF FIRST STATION

Small

Medium

Large

Very large

GOOD MARKET ($)

60,000

90,000

110.000
280,000

FAIR MARKET ($)

25.000 40,000 60.000 50,000

POOR MARKET ($)

-5.000

-20,000 -30,000 -200.000

Deliverables:

Using Excel, design a decision table for this decision.

Question 1: What is the maximin decision?

Question 2: What is the maximax decision?

Question 3: What is the Laplace decision?

Question 4: What is the Hurwicz Criterion decision?

Reference no: EM132535237

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