Answered: The following payoff table shows…

The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. If the probability of S1 is 0.5, then the expected value approach for X is

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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Question

The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. If the probability of S1 is 0.5, then the expected value approach for X is

The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature.

| State of Nature | Alternatives |
|-----------------|--------------|
| | X | Y | Z |
| 1 | 12 | -2 | 8 |
| 2 | 4 | 10 | 5 |

If the probability of S1 is 0.5, then the expected value approach for X is:

- ○ 6.5
- ○ 8
- ○ 3
- ○ 4

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