Which of these three outlet sizes is the riskiest

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Question

The owner of Tastee Cookies needs to decide whether to lease a small, medium, or large new retail outlet. She estimates that monthly profits will vary with demand for her cookies as follows: Size of Outlet LOW demand HIGH demand Small $ 1,000 $ 1,000 Medium $ 500 $ 2,500 Large 0 $ 3,000 What outlet size would be best to lease using maximax? What outlet size would be best to lease using minimax regret? If she feels there is a 30 percent chance that demand will be high, what outlet size should be chosen? Which of these three outlet sizes is the riskiest? Explain

Reference no: EM133403067

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