Problem 1 You have been tasked with planning the annual gala for the United Way of Salt Lake. The event is intended to be a formal, but fun-filled evening with great food and entertainment. Prominent members (and donors) of the community regularly attend. The Gala is your largest fundraiser of the year. Consider the following “game against nature” in which mother nature has no payoffs. You must decide whether to hold the gala outdoors or indoors. The amount you can raise is determined by whether you choose indoors or outdoors and whether or not mother nature decides to rain. Historically, outdoor galas have proven to raise more money than indoor galas, but rain certainly tends to dampen donor moods. The payoffs and expected probabilities are provided in the following matrix: Mother Nature Rain (1/3) No rain (2/3) United Way Indoors 200,000 200,000 Outdoors 100,000 300,000 Should you hold the gala outdoors or indoors? Why? Show your work
Problem 1
You have been tasked with planning the annual gala for the United Way of Salt Lake. The event is intended to be a formal, but fun-filled evening with great food and entertainment. Prominent members (and donors) of the community regularly attend. The Gala is your largest fundraiser of the year.
Consider the following “game against nature” in which mother nature has no payoffs. You must decide whether to hold the gala outdoors or indoors. The amount you can raise is determined by whether you choose indoors or outdoors and whether or not mother nature decides to rain. Historically, outdoor galas have proven to raise more money than indoor galas, but rain certainly tends to dampen donor moods. The payoffs and expected probabilities are provided in the following matrix:
| Mother Nature | |||
| Rain (1/3) | No rain (2/3) | ||
| United Way | Indoors | 200,000 | 200,000 |
| Outdoors | 100,000 | 300,000 |
Should you hold the gala outdoors or indoors? Why? Show your work.
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