The manager is making a decision whether or not to make the small facility. Demand is unsure and can be either at the high or low level. If manager selects the small facility and demand is low, payoff is $300. If manager selects the small facility and demand is high, payoff is $100. On the other hand, if manager selects large facility and demand is low, payoff is as given -$200, but if demand is high, payoff is $800.
i) Determine the best decision based on maximax criterion?
ii) Compute the best decision based on maximin criterion?
iii) Compute the best decision based on minimax regret?