Table Q5 Machines/Probabilities Low (0.10) 50 Moderate (0.60) 60 High (0.30) 85 Alternatives A в 60 60 60 40 50 90 a) Explain what decision would be appropriate using each of the following criteria such as Maximin, Maximax, Minimax regret, and Laplace. b) Discuss the acceptable alternatives by using a decision tree and an EPVI value.
Table Q5 Machines/Probabilities Low (0.10) 50 Moderate (0.60) 60 High (0.30) 85 Alternatives A в 60 60 60 40 50 90 a) Explain what decision would be appropriate using each of the following criteria such as Maximin, Maximax, Minimax regret, and Laplace. b) Discuss the acceptable alternatives by using a decision tree and an EPVI 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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Question
q(b)
Transcribed Image Text:The engineer has identified three acceptable alternatives to handle the increased workload.
One alternative is to replace present machine (A), the second is to hire two new machines
(B), and the third is to redesign current machine (C) so that the production can be continued
with little additional effort. The estimated cost for various options and machines are shown
in the following Table Q5.
Table Q5
Machines/Probabilities
Alternatives
Low (0.10)
Moderate (0.60)
High (0.30)
A
50
60
85
B
60
60
60
40
50
90
a) Explain what decision would be appropriate using each of the following criteria such
as Maximin, Maximax, Minimax regret, and Laplace.
b)
uss the acceptable alternatives by using a decision tree and an EPVI value.
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