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Question: A local real estate investor in Orlando is considering three alternative investments: a motel, a restaurant, or a theater. Profits from the motel or restaurant will be affected by the availability of gasoline & the number of tourists; profits from the theater will be relatively stable under any conditions. The following payoff table shows the profit or loss that could result from each investment:
Investment
Gasoline Availability
Shortage
Stable Supply
Surplus
Motel
-$8,000
$15,000
$20,000
Restaurant
2,000
8,000
6,000
Theater
5,000
Find the best investment, using the following decision criteria.
[A] Minimax regret[B] Hurwicz [alpha = .4][C] Equal likelihood[D] Maximax[E] Maximin
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