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

DIFFERENTIAL EQUATIONS, WHICH LIFE PROBLEMS CAN BE SOLVED USING THE KNOWLED...

WHICH LIFE PROBLEMS CAN BE SOLVED USING THE KNOWLEDGE OF DIFFERNTIAL EQUATIONS?

What are natural numbers and whole numbers, What are Natural Numbers and Wh...

What are Natural Numbers and Whole Numbers? Natural numbers are the numbers that you "naturally" use for counting: 1, 2, 3, 4, ... The set of whole numbers is the set of

Mathematical science, state tha different types of models used in operation...

state tha different types of models used in operations research.

Volume of grains in the silo , The volume of grains in a silo at a particul...

The volume of grains in a silo at a particular time (measured in hours) is given by V (t) = 4t(3-t) m3. Find the rate of change of the volume of grains in the silo from first princ

Topology, Is usual topology on R is comparable to lower limit topology on R...

Is usual topology on R is comparable to lower limit topology on R

What are mutually exclusive events, Q. What are Mutually Exclusive events? ...

Q. What are Mutually Exclusive events? Mutually Exclusive Events are mutually exclusive if they cannot occur at the same time. For example, if you roll one die, you canno

Permatuation and combination problem, A student is allowed to select at mos...

A student is allowed to select at most n-blocks from a collection of (2n + 1) books. If the total number of ways in which he can select a book is 63, find the value of n. Solution

Function of a function, Function of a Function Suppose ...

Function of a Function Suppose y is a function of z,            y = f(z) and z is a function of x,            z = g(x)

Quantitative techniques, mentioning the type of business you could start an...

mentioning the type of business you could start and the location of your business, use the steps of quantitative methods for decision making narrating them one by one in the applic

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