Graphical method, Managerial Accounting

Assignment Help:

GRAPHICAL METHOD

Graphical methods can be used in games with no saddle points and having pay off m X 2 or 2 X n matrix.
The aim is to substitute a much simpler 2 X 2 matrix for the original m X 2 or 2 X m matrix.

Example:
Establish the optimum strategies and the value of the game from the following payoff matrix game.

24_formula1.jpg

Draw two vertical axes and plot two payoffs corresponding to each of the five columns. The pay off numbers in the first row is plotted on Axis I and those in second rows on Axis II.

1050_formula2.jpg



Thus the two pay off numbers 6 and 3 in the first column are shown respectively by point A on Axis I and point B on Axis II.
Join the corresponding pay off numbers on Axis I and Axis II by straight lines.

On the two intersecting lines at the very bottom, thicken them from below up to the point of intersection, i.e. utmost point on the boundary.
The thick lines on the graph KT and LT meet at T

The two lines passing through T, identify the two critical moves of Y which combined with X, yield the following 2 X 2 matrix.

743_Formula3.jpg


Related Discussions:- Graphical method

What is meant by the term open book management, What is meant by the term O...

What is meant by the term Open Book Management? How does Open Book Management improve the organizations ability to achieve and improve results?

Batch size of one-jit features, Batch size of one Set up time is the am...

Batch size of one Set up time is the amount of time needed to adjust tools and to retool for various product. Long set ups a change over time make the production of batches wit

Credit limit, Credit Limit A credit restriction is the maximum amount o...

Credit Limit A credit restriction is the maximum amount of credit that the firm will extend at a point of time. This indicates the extent of risk taken through the firm through

Definition of activities based costing, Definition of Activities based cost...

Definition of Activities based costing Activity based costing is a system that focuses on activities as the fundamental cost objects and uses the costs of these activities as b

Advantages of abc analysis, ADVANTAGES OF "ABC ANALYSIS" The advantages...

ADVANTAGES OF "ABC ANALYSIS" The advantages derived from this analysis and its consequent follow up are summarized below: 1) Facilities selective control and thereby save va

Transfer pricing, find full-cost& variable cost using transfer pricing meth...

find full-cost& variable cost using transfer pricing method

Define activities based costing by horngren, Define Activities based costin...

Define Activities based costing by horngren According to horngren " ABC is a system that focuses on activities as fundamental cost object and utilizes cost of these activi

Internal Controls, What is the definition of internal controls

What is the definition of internal controls

Transportation problem-solution, Transportation Problem-Solution Soluti...

Transportation Problem-Solution Solution of the Transportation Problem: The fundamental steps of the transportation method are: Step 1:       Determine a preliminary b

Orders per year , Lila Battle has determined that the annual demand for num...

Lila Battle has determined that the annual demand for number 6 screws is 100,000 screws. Lila, who works in her brother's hardware shop, is in charge of purchasing. She estimates t

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd