Question

NEED HELP ASAP

Betsy Spotzman makes decisions according to deterministic decision making criterion. For her current problem, Betsy has constructed the following payoff table be cost 51 52 53 a1 50 100-100 a2 0 10 10 a3 20 40 40 Prob 0.5 0.3 0.2 What should Betsy's decision be under the regret approach? What is the corresponding cost? Decision State of Nature cost

Answer 1

0 Solution By using the regret approach , loss table matvia is 1088 3 Sg 88 Maximumregret a 50-50=0 100-100=0 -10+100-90 90 50-0 100-10-90 -10710:0 90 - 50 03 50-20-30 100-40=60 440+40-30 60 . Minimum (90,90160) = 60 the corresponding pooject 20 x PCS7) + 404 PCS2) + (-40) * P(S3) : 90 x 0.5 + boxo.3+ (-40)*0.2 = 10 +12-8 14 Onits Decision State of nature pooject Minimot regret 14 Oolts ) Given matoia pootit 81 82 89 minimum payou AI 220 HO 110 tro A2 200 180 100 150 poob 0.6 0.8 0) marimin max (110 1150) = 150 conserva dve a morimam approach we choose Ag under the a profit under the approach is (0.6.8200+60-3 *180) + (0-1 X 100) = 189 i es $ 189,000.,