MyLab Operations Management with Pearson eText -- Access Card -- for Operations Management: Processes and Supply Chains
12th Edition
ISBN: 9780134742366
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Textbook Question
Chapter A, Problem 16P
Build-Rite Construction has received favorable publicity from guest appearances on a public TV home improvement program. Public TV programming decisions seem to be unpredictable, so Build-Rite cannot estimate the probability of continued benefits from its relationship with the show. Demand for home improvements next year may he either low or high. But Build-Rite must decide now whether to hire more employees, do nothing, or develop subcontracts with other home improvement contractors. Build-Rite has developed the following payoff table:
Which alternative is best, according to each of the following decision criteria?
- Maximin
- Maximax
- Laplace
- Minimax regret
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Build-Rite Construction has received favorable publicity from guest appearances on a public TV home improvement program. Public TV programming decisions seem to be unpredictable, so Build-Rite cannot estimate the probability of continued benefits from its relationship with the show. Demand for home improvements next year may be either low or high. But Build-Rite must decide now whether to hire more employees, do nothing, or develop subcontracts with other home improvement contractors. Build-Rite has developed the following payoff table:
The best decision according to laplace criterion is alternative to what? and the weighted payoff for this decision is what?
Build-Rite Construction has received favorable publicity from guest appearances on a public TV home improvement program. Public TV programming decisions seem to be unpredictable, so Build-Rite cannot estimate the probability of continued benefits from its relationship with the show. Demand for home improvements next year may be either low or high. But Build-Rite must decide now whether to hire more employees, do nothing, or develop subcontracts with other home improvement contractors. Build-Rite has developed the following payoff table:
Demand for Home Improvements
Alternative
Low
Moderate
High
Hire
($250,000)
$100,000
$625,000
Subcontract
$100,000
$150,000
$415,000
Do nothing
$50,000
$80,000
$300,000
Which alternative is best, according to each of thefollowing decision criteria?a. Maximinb. Maximaxc. Laplaced. Minimax regret
Build-Rite Construction has received favorable publicity from guest appearances on a public TV home improvement
program. Public TV programming decisions seem to be unpredictable, so Build-Rite cannot estimate the probability
of continued benefits from its relationship with the show. Demand for home improvements next year may be either
low or high. But Build-Rite must decide now whether to hire more employees, do nothing, or develop subcontracts
with other home improvement contractors. Build-Rite has developed the following payoff table:
Demand for Home Improvements
Alternative
Low
Moderate
High
($140,000)
$86,000
$100,000
$138,000
$296,000
$130,000
$587,000
$416,000
$421,000
Hire
Subcontract
Do nothing
Which alternative is best, according to each of the following decision criteria?
a. The best decision according to maximin criterion is alternative
and the payoff for this decision is
$
(Enter your response as an integer.)
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