A company is engaged in the process of launching a new product. The top management of the company has three options in terms of launching the product in three sales zones: North region(N), South region (S), and East region. The management has decided to take the final decision on the basis of demand for the product, which is devided in to three categories: high demand, medium demand, and low demand. On the basis of apst data and management's view, the respective probabilities for three categories of demand are estimated to be 0.45, 0.35, o.20. Following table indicates the estimated profit (in thousand rupees) for various combinations of events and acts: combinations of events and acts

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
icon
Related questions
Question

Please give handwritten 

A company is engaged in the process of launching a new product. The top management of the company has three options in
terms of launching the product in three sales zones: North region(N), South region (S), and East region. The management has
decided to take the final decision on the basis of demand for the product, which is devided in to three categories: high demand,
medium demand, and low demand. On the basis of apst data and management's view, the respective probabilities for three
categories of demand are estimated to be 0.45, 0.35, o.20. Following table indicates the estimated profit (in thousand rupees) for
various combinations of events and acts:
Table - Estimated profit (in thousand rupees) for various combinations of events and acts
Course of action
North Region(N) South Region(S) East Region(E)
Demand
Probability
High
0.45
100
- 60
-120
Medium
0.35
80
- 20
40
Low
0.20
60
150
135
Construct a decision tree and select the alternative with highest expected payoff, using expected value criterion.
Transcribed Image Text:A company is engaged in the process of launching a new product. The top management of the company has three options in terms of launching the product in three sales zones: North region(N), South region (S), and East region. The management has decided to take the final decision on the basis of demand for the product, which is devided in to three categories: high demand, medium demand, and low demand. On the basis of apst data and management's view, the respective probabilities for three categories of demand are estimated to be 0.45, 0.35, o.20. Following table indicates the estimated profit (in thousand rupees) for various combinations of events and acts: Table - Estimated profit (in thousand rupees) for various combinations of events and acts Course of action North Region(N) South Region(S) East Region(E) Demand Probability High 0.45 100 - 60 -120 Medium 0.35 80 - 20 40 Low 0.20 60 150 135 Construct a decision tree and select the alternative with highest expected payoff, using expected value criterion.
Expert Solution
steps

Step by step

Solved in 2 steps with 2 images

Blurred answer
Recommended textbooks for you
MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
Statistics
ISBN:
9781119256830
Author:
Amos Gilat
Publisher:
John Wiley & Sons Inc
Probability and Statistics for Engineering and th…
Probability and Statistics for Engineering and th…
Statistics
ISBN:
9781305251809
Author:
Jay L. Devore
Publisher:
Cengage Learning
Statistics for The Behavioral Sciences (MindTap C…
Statistics for The Behavioral Sciences (MindTap C…
Statistics
ISBN:
9781305504912
Author:
Frederick J Gravetter, Larry B. Wallnau
Publisher:
Cengage Learning
Elementary Statistics: Picturing the World (7th E…
Elementary Statistics: Picturing the World (7th E…
Statistics
ISBN:
9780134683416
Author:
Ron Larson, Betsy Farber
Publisher:
PEARSON
The Basic Practice of Statistics
The Basic Practice of Statistics
Statistics
ISBN:
9781319042578
Author:
David S. Moore, William I. Notz, Michael A. Fligner
Publisher:
W. H. Freeman
Introduction to the Practice of Statistics
Introduction to the Practice of Statistics
Statistics
ISBN:
9781319013387
Author:
David S. Moore, George P. McCabe, Bruce A. Craig
Publisher:
W. H. Freeman