Cambridge Ltd is currently suffering from a depression in the market for its products and needs to decide which of three products it should continue produce, so that it can maximise its profits. They have recently employed the services of Research It Ltd who have researched Cambridge Ltd and their products and have produced the following information: Research It Ltd. have provided information for three levels of demand, low, medium and high and a probabilities for each level of demand as 10%, 50% and 40% respectively. The net incomes for each product are: Product A: £50,000, £110,000, Product B: £120,000, £175,000, Product C: £180,000, £200,000, Required: £145,000 £220,000 £230,000 a. Construct the payoff table for the three products.
Cambridge Ltd is currently suffering from a depression in the market for its products and needs to decide which of three products it should continue produce, so that it can maximise its profits. They have recently employed the services of Research It Ltd who have researched Cambridge Ltd and their products and have produced the following information:
Research It Ltd. have provided information for three levels of demand, low, medium and high and a probabilities for each level of demand as 10%, 50% and 40% respectively.
The net incomes for each product are: Product A: £50,000, £110,000, Product B: £120,000, £175,000, Product C: £180,000, £200,000,
Required:
£145,000 £220,000 £230,000
a. Construct the payoff table for the three products.
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