A payoff table is given as:
|
State of Nature
|
|
Decision
|
S1
|
S2
|
S3
|
|
D1
|
10
|
8
|
6
|
|
D2
|
14
|
15
|
2
|
|
D3
|
7
|
8
|
9
|
a. What decision should be made by the optimistic decision maker?
b. What decision should be made by the pessimistic decision maker?
c. What decision should be made under minimax regret?
d. If the probabilities of s1, s2, and s3are .2, .4, and .4, respectively, then what decision should be made under expected value?
e. Using the probabilities in d), what is the EVPI?