1. The profit payoff table below showing profit for a decision problem with four states of nature and four decision alternatives are presented below; State of Alternative Nature A1 A2 A3 A4 S1 41 45 30 40 S2 32 38 45 35 S3 51 42 50 31 S4 51 35 34 37 a. Recommend a decisions using the criteria below; i. Maximim criterion i. Maximac criterion Hurwick criterion (a =0.70) Laplace criterion Minimim criterion (EOL Table) ili. iv. V. b. Assume the probabilities for each state of nature are knows, (S1-0.3, S2-D0.2, S3%3D0.3 and S4-0.2). Find the best alternative with EMV and EOL table. c. Based on the results above, which alternative is the best altenative? Why?

Practical Management Science
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Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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1. The profit payoff table below showing profit for a decision problem with four states of
nature and four decision alternatives are presented below;
State of
Alternative
Nature
A1
A2
A3
A4
S1
41
45
30
40
S2
32
38
45
35
S3
51
42
50
31
S4
51
35
34
37
a.
Recommend a decisions using the criteria below;
i.
Maximim criterion
ii.
Maximac criterion
ww
Hurwick criterion (a =0.70)
Laplace criterion
Minimim criterion (EOL Table)
ili.
iv.
V.
b. Assume the probabilities for each state of nature are knows, (S1-D0.3, S2-D0.2, S3-D0.3
and S4-0.2). Find the best alternative with EMV and EOL table.
c. Based on the results above, which alternative is the best alternative? Why?
Transcribed Image Text:1. The profit payoff table below showing profit for a decision problem with four states of nature and four decision alternatives are presented below; State of Alternative Nature A1 A2 A3 A4 S1 41 45 30 40 S2 32 38 45 35 S3 51 42 50 31 S4 51 35 34 37 a. Recommend a decisions using the criteria below; i. Maximim criterion ii. Maximac criterion ww Hurwick criterion (a =0.70) Laplace criterion Minimim criterion (EOL Table) ili. iv. V. b. Assume the probabilities for each state of nature are knows, (S1-D0.3, S2-D0.2, S3-D0.3 and S4-0.2). Find the best alternative with EMV and EOL table. c. Based on the results above, which alternative is the best alternative? Why?
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