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5. A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd). States of Nature (size of crowd) Large Alternatives Large Inventory | Average | Small $22,000 S12,000 | - $2,000 |Average Inventory | S15,000 $12,000 $6,000 |Small Inventory $ 9,000 | S 6,000 $5,000 If the probabilities associated with the states of nature are 0.30 for a large crowd, 0.50 for an average crowd, and 0.20 for a small crowd, determine: (a) the opportunity loss table.

5. A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd). States of Nature (size of crowd) Large Alternatives Large Inventory | Average | Small $22,000 S12,000 | - $2,000 |Average Inventory | S15,000 $12,000 $6,000 |Small Inventory $ 9,000 | S 6,000 $5,000 If the probabilities associated with the states of nature are 0.30 for a large crowd, 0.50 for an average crowd, and 0.20 for a small crowd, determine: (a) the opportunity loss table.

A First Course in Probability (10th Edition)
A First Course in Probability (10th Edition)
10th Edition
ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
Section: Chapter Questions
Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...
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5. A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd). States of Nature (size of crowd) Large Average Small $22,000 $12,000 - $2,000 Alternatives Large Inventory Average Inventory $15,000 $12,000 Small Inventory $6,000 $ 9,000 $ 6,000 $5,000 If the probabilities associated with the states of nature are 0.30 for a large crowd, 0.50 for an average crowd, and 0.20 for a small crowd, determine: (a) the opportunity loss table. States of Nature Large Average Alternatives Small 8,000 Large Average Small 7,000 13,000 6,000 1,000 ANSWER
Transcribed Image Text:5. A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd). States of Nature (size of crowd) Large Average Small $22,000 $12,000 - $2,000 Alternatives Large Inventory Average Inventory $15,000 $12,000 Small Inventory $6,000 $ 9,000 $ 6,000 $5,000 If the probabilities associated with the states of nature are 0.30 for a large crowd, 0.50 for an average crowd, and 0.20 for a small crowd, determine: (a) the opportunity loss table. States of Nature Large Average Alternatives Small 8,000 Large Average Small 7,000 13,000 6,000 1,000 ANSWER
(b) minimum expected opportunity loss (EOL). minimum EOL = $1,600
Transcribed Image Text:(b) minimum expected opportunity loss (EOL). minimum EOL = $1,600
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