Consider the car-rental insurance scenario in Problems 3 and 10. Use the approach described in this chapter to develop your personal utility function for the payoffs associated with this decision. Determine the decision that would result using the utilities instead of the payoffs. Is the decision consistent with your choice?

Data from Problem 3

The DoorCo Corporation is a leading manufacturer of garage doors. All doors are manufactured in their plant in Carmel, Indiana, and shipped to distribution centers or major customers. DoorCo recently acquired another manufacturer of garage doors, Wisconsin Door, and is considering moving its wood door operations to the Wisconsin plant. Key considerations in this decision are the transportation, labor, and production costs at the two plants. Complicating matters is the fact that marketing is predicting a decline in the demand for wood doors. The company developed three scenarios: