Review Test Submission: Quiz3 Content Course QMBLC Summer14 Test Quiz3 • Question 1 A payoff table is given below and the probabilities of s1, s2, and s3 are .2, .5, and .3, respectively, then what is the most you pay for a highly reliable forecast? s1 s2 s3 d1 250 750 500 d2 300 -250 1200 d3 500 500 600 • Question 2 Expected value is the sum of the weighted payoff possibilities at a circular node in a decision tree. • Question 3 A payoff table is given as; what choice should be made by the conservative decision maker? s1 s2 s3 d1 250 750 500 d2 300 -250 1200 d3 500 500 600 • Question 4 For the payoff table below, the decision maker will use P(s1) = .15, P(s2) = .5, and P(s3) = .35. What is the expected value for the best decision? State of Nature Decision s1 s2 s3 d1 -5,000 1,000 10,000 d2 -15,000 -2,000 40,000 • Question 5 If the probability of s1 is .40 what is the value at node 11. • Question 6 Given the following table of payoffs use sensitivity analysis to determine at what probability or less you would select decision A? Decision Event1 Event 2 A 0 20 B 6 16 C 8 0 • Question 7 Given the following table of payoffs use sensitivity analysis to determine at what probability or more you would select decision C? Decision Event1 Event 2 A 0 20 B 6 16 C 8 0 • Question 8 If the probability of s1 = .6 and the probability of F = .40 what is the value at node 4. • Question 9 The following is a payoff table giving profits for various situations. What decision would an optimist make? • Question 10 The following is a payoff table. What decision should be made based on the minimax regret criterion?
