1. The Quick Gas Company is planning to open a new convenience store to expand their operations on the north side of town. They have identified two locations that meet their criteria for traffic density and ease of access. The first is on Queen Street, and the second is on Gerard Avenue. The Queen Street location is listed available for sale for $550,000. The Gerard Avenue location is available for sale for $375,000.

The value of the two locations depends upon the results of two decisions that are being made by politicians. The first is that the county has offered some tax incentives for a company to build a grocery distribution warehouse that would employ approximately 2,200 people in the area near the Queen Street location. The second is that a multi-year construction project is being considered on Gerard Avenue that would depress traffic.

Quick Gas has estimated the financial impact of the political decisions, and forecast the potential income from the two locations for each scenario. The results are shown in the table below, which does not include the cost of the property above or the $850,000 cost to build the convenience store.

	No Warehouse No Construction	No Warehouse Construction	Warehouse No Construction	Warehouse Construction
Queen Street	$1,350,000	$1,420,000	$1,680,000	$1,770,000
Gerard Avenue	$1,600,000	$1,300,000	$1,650,000	$1,350,000
Probability	12%	28%	18%	42%

Find the net income for each outcome and decision by including the costs to purchase the property and build the convenience stores.

Answer to the nearest dollar. Do not include any punctuation ($ or ,) in your answer!

Examples of accepted answers: 12345, -12345 Examples of incorrect answers: $12,345, 12,345, $12345, -12,345, (12345), ($12345)

	No Warehouse No Construction	No Warehouse Construction	Warehouse No Construction	Warehouse Construction
Queen Street	Answer	Answer	Answer	Answer
Gerard Avenue	Answer	Answer	Answer	Answer

Find the expected value of each location. Answer to the nearest dollar. Do not include punctuation ($ or ,) in your answer.

Queen Street: Answer Gerard Avenue: Answer

Which location should the Quick Gas Company choose based on the expected value method of decision making?

Queen Street

Gerard Avenue

2.

The table below shows the cost for several choices (choice 1, choice 2, and choice 3) if certain outcomes happen (outcome 1, outcome 2, and outcome 3). You do not know which outcome will occur. Using the minimax regret decision-making method, answer the questions below:

COST =========	Outcome 1 =========	Outcome 2 =========	Outcome 3 =========
Choice 1	146	142	135
Choice 2	138	151	141
Choice 3	144	148	136

Knowing that this table shows cost, and that regret is always either 0 or positive, how would you change how you calculate regret? Regret for a certain choice is still the difference between the best choice for a specific outcome and the choice made. Fill in the table below with the amount of regret for each choice and outcome. Be sure to adjust your calculations since the information given is cost.

REGRET =========	Outcome 1 =========	Outcome 2 =========	Outcome 3 =========
Choice 1	Answer	Answer	Answer
Choice 2	Answer	Answer	Answer
Choice 3	Answer	Answer	Answer

What is the maximum regret for choice 1? Answer

What is the maximum regret for choice 2? Answer

What is the maximum regret for choice 3? Answer

What is the best decision using the minimax regret decision-making method?

Choice 1

Choice 2

Choice 3

Outcome 1

Outcome 2

Outcome 3