The following payoff table provides profits based on various posible decision alternatives and various levels of demand at Kmart Print Shop. Alternatives Low High Alternative 1 10,000 30,000 Alternative 2 5,000 40,000 Alternative 3 -2,000 50,000 The probability of low demand is 0.4, whereas the probability of high demand is 0.6. What is the expected value with perfect information (EVwPI)?
Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
The following payoff table provides profits based on various posible decision alternatives
and various levels of demand at Kmart Print Shop.
| Alternatives | Low | High | |
| Alternative 1 | 10,000 | 30,000 | |
| Alternative 2 | 5,000 | 40,000 | |
| Alternative 3 | -2,000 | 50,000 |
The probability of low demand is 0.4, whereas the probability of high demand is 0.6.
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