Question

Mr. H is considering which one of three alternative courses of action A, B and C to take. The profit or loss from each choice depends on which one of four circumstances,I, II, I or IV will apply. The possible profits and losses, in thousands of dollars, are given in the following payoff table. Losses are shown as negative figures: Action A 70 -10 80 60 Action B 60 20 0 100 Action C 70 -5 50 115 Circumstance I Circumstance I Circumstance III Circumstance IV Required: State which action would be selected using each of the decision rules: maximax, imin and minimax regret cri max tena

Answer 1

Maximax Apppoacl en A 70 8o 6 80 10 Ib o Achenc 70-5 so 115016) -5 takke umax Poyoth Roceived TV 0-70-0 -55 20-20-o lo-80-1100-tIS 60-70 /O -15 70-70 O 5225 50-8 11s-us с. ะ-30 Reaeet Tabla -30 -55 lo -loo 15 253O acuen