Given the following conditional value table:States of NatureVery FavorableAverageUnfavorableAlternativesMarketMarketMarketBuild new plant$250,000$270,000$180,000$185,000$50,000$0- $200,000- $220,000Subcontract$100,000$0Overtime- $12,000Do Nothing$0a) Using the decision making under uncertainty with the criterion of MaximaxThe appropriate decision will beThe value of the return under this decision is $b) Using the decision making under uncertainty with the criterion of MaximinThe appropriate decision will beThe value of the return under this decision is $c) Using the decision making under uncertainty with the criterion of Equally LikelyThe appropriate decision will beThe value of the return under this decision is $(enter your answer as a whole number).

The decision-making process includes identifying a decision, gathering information, and evaluating…

Answered: Given the following conditional value…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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What would be the best way to estimate whether a piece of land could be used to manage an existing (at a profit) in the relatively short- and long-run? Explain what information you would need to make the decision what would be a “Second best” alternative to the criteria you picked first?
The XY Manufacturing Company must decide whether to manufacture a component part at its plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in ten thousand of pesos): Decision Alternative Manufacture, d₁ Purchase, d₂ Low Demand $1 -100 50 State of Nature Medium Demand S2 200 225 High Demand S3 500 350 MA The state-of-nature probabilities are P(s₁) = 0.35, P(s₂) = 0.35, and P(S3) = 0.30. a. Use a decision tree to recommend a decision. b. Use EVPI to determine whether XY Manufacturing Company should attempt to obtain a better estimate of demand.
Using decision trees analysis and EMV, what should DMR do?
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A shop will decide to sell either product A or B or C in the coming season. Demand in that season can be high, average or low. Payoff table below shows the related returns in TL. You will create your own data for Product B row:)) States of nature Alternatives High demand Average demand Low demand Product A 2000 1000 -200 Product B Product C 1000 500 400 a. What would be the decision according to Minimax Regret? b. What is the maximum amount of money the company should pay for perfect information? (Assign probabilities for high, average and low demand)
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A well-known plastic mould and die manufacturer in Toronto intends to expand internationally in anticipation of strong demand and expansion in the plastic die manufacturing sector. use the table beneath. Using the Maximax, Maximin, and equally likely conditions, assist the business in making the best option in an unclear situation. 0.5 for a highly favourable condition, 0.2 for an average demand, and 0.3 for an unfavourable state are the probabilities linked with the states of nature.a) Choose the course of action that will give Andrew the highest predicted monetary value (EMV).b) Determine the anticipated value of perfect information (EVPI).
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The Gorman Manufacturing Company must decide whether to manufacture a component part at its Milan, Michigan, plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in thousands of dollars): State of Nature Low Demand Medium Demand High Demand Decision Alternative s1 s2 s3 Manufacture, d1 -20 40 100 Purchase, d2 10 45 70 The state-of-nature probabilities are P(s1) = 0.35, P(s2) = 0.35, and P(s3) = 0.30. Use a decision tree to recommend a decision.Recommended decision: Use EVPI to determine whether Gorman should attempt to obtain a better estimate of demand. EVPI: $ fill in the blank 3 A test market study of the potential demand for the product is expected to report either a favorable (F) or unfavorable (U) condition. The relevant conditional probabilities are as follows: P(F | s1) = 0.10 P(U | s1) = 0.90 P(F | s2) = 0.40 P(U |…

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