Maximin method -decision making under uncertainty, Mathematics

Assignment Help:

Decision making under uncertainty

Various methods are used to make decision in circumstances whereas only the pay offs are identified and the likelihood of every state of nature are identified

a)      Maximin Method

This criterion is based upon the "conservative approach' to suppose that the worst possible is going to occur. The decision maker considers every strategy and locates the minimum pay off for each and then selects that alternative that maximizes the minimum payoff

Demonstration

Rank the products A, B and C applying the Maximin rule b using the given payoff table showing potential losses and profits which are expected to arise from launching these three products in three market situation

Pay off table in £ 000's

 

Boom condition

Steady state

Recession

Mini profits row minima

Product A

+8

1

-10

-10

Product B

-2

+6

+12

-2

Product C

+16

0

-26

-26

 

In above table

Ranking the MAXIMIN rule = BAC

 


Related Discussions:- Maximin method -decision making under uncertainty

Equation: 4x^4+9x^4=64 , If 4x^4+9x^4=64 then the maximum value of x^2+y^2 ...

If 4x^4+9x^4=64 then the maximum value of x^2+y^2 is solution) From the eq. finding the value of x^2 and putting it in x^2 + y^2.we get 2nd eq. differentiating that and putting

Net Present Value, A business has the opportunity to expand by purchasing ...

A business has the opportunity to expand by purchasing a machine at a cost of £80,000. The machine has an estimated life of 5 years and is projected to generate a cashflow of £20,0

what are the coordinates of the vertex , Use the graph of y = x2 - 6x  to ...

Use the graph of y = x2 - 6x  to answer the following: a)         Without solving the equation (or factoring), determine the solutions to the equation  x 2 - 6x = 0  usi

Find out that vector are linearly dependent, Find out if the following set ...

Find out if the following set of vectors are linearly independent or linearly dependent. If they are linearly dependent get the relationship among them. Solution : Ther

Progressions, We will look at three types of progressions called Ar...

We will look at three types of progressions called Arithmetic, Geometric and Harmonic Progression. Before we start looking at the intricacies of these let us unders

Earning money, Terry earns $680 per week. He is entitled to 4 weeks annual ...

Terry earns $680 per week. He is entitled to 4 weeks annual leave and receives an additional holiday loading of 17.5%. Calculate his total pay for this holiday period.

Greatest common factors, Lindy has 48 chocolate chip cookies and 64 vanilla...

Lindy has 48 chocolate chip cookies and 64 vanilla wafers. How many bags can lindy fill if she puts the chocolate chip cookies and the vanilla wafers in the same bags? She plans

Fractions, what is greater than three forths

what is greater than three forths

Horizontal tangents for parametric equations, Horizontal tangents for Param...

Horizontal tangents for Parametric Equations Horizontal tangents will take place where the derivative is zero and meaning of this is that we'll get horizontal tangent at value

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