The subsiquent cost tree illustrate the expected outcome

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Reference no: EM1316174

Find the Expected value of the perfect information for the given problem.

Given the following cost tree, what is the expected outcome?

5

$1,000

0.3

$500

0.2

($300)

0.2

$1,500

0.8

$300

 

 

Optimistic decision from the given information.

The following is a payoff table giving profits for various situations.

 

 Status of Nature

 

A

B

C

Alternative 1

120

140

120

Alternative 2

200

100

50

Alternative 3

100

120

180

Do nothing

0

0

0

What decision would an optimist make?

 

 

Reference no: EM1316174

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