Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Transcribed Image Text:Given is a decision payoff table.
Alternatives
Small Facility
Medium Facility
Large Facility
Low
26
18
-7
Future Demand
Moderate
21
31
30
High
18
22
42
a) The best decision under uncertainty using MAXIMAX is to select Blank 1 facility
b) The best decision under uncertainty using MAXIMIN is to select Blank 2 facility
c) The best decision under uncertainty using LAPLACE/EQUALITY LIKELY is to select Blank 3 facility
d) If the probabilities for Future Demand when it is Low-0.35, Moderate -0.30, and High-0.35, the expected monetary value (EMV) for
the large facility-Blank 4.
Transcribed Image Text:Small Facility
Medium Facility
Large Facility
26
18
-7
21
31
30
18
22
42
a) The best decision under uncertainty using MAXIMAX is to select Blank 1 facility
b) The best decision under uncertainty using MAXIMIN is to select Blank 2 facility
c) The best decision under uncertainty using LAPLACE/EQUALITY LIKELY is to select Blank 3 facility
d) If the probabilities for Future Demand when it is Low-0.35, Moderate-0.30, and High-0.35, the expected monetary value (EMV) for
the large facility - Blank 4.
e) If the probabilities for Future Demand when it is Low-0.35, Moderate-0.30, and High-0.35, the best decision under risk is to select
Blank 5 facility.
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