Question: A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decisions) and states of nature (size of

A concessionaire for the local ballpark has developed a table of conditional values for the various alternatives (stocking decisions) and states of nature (size of crowd).

If the probabilities associated with the states of nature are 0.30 for a large crowd, 0.50 for an average crowd, and 0.20 for a small crowd, determine:
a. The alternative that provides the greatest expected monetary value (EMV).
b. The expected value of perfect information(EVPI).

States of Nature (Demand) Stocking Large Crowd (S) AveragSmall Crowd Decision Large stock Average stock Small stock Probabilities Crowd (S) 2.000 $6.000 $6,000 0.2 S22,000 12,000 150 12,000 S6,000 0.5 $9,000 0.3

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