A B C D E F G H K L M Question 3 (18 points) An investor is considering four different opportunities: A, B, C, or D. The payoff for each opportunity will depend on the economic conditions, represented in the payoff table below. Payoff Table Economic Conditions Investment Poor Average Good Excellent 75 20 80 15 40 50 300 -200 -80 10 25 25 25 25 Probability 0.35 0.5 0.1 0.05 Part a) Give the maximax, maximin, and equal likelihood criterion. What investment would be made using these criterion? Note: Excel formulas not required. he maximax criterion: This leads to a decision of (A, B. C, or D) The maximin criterion: This leads to a decision of (A, B, C, or D) The equal likelihood criterion: A: B: C: This leads to a decision of (A, B, C, or D) Part b) Given the probabilities in the last row of the payoff table above, compute the expected value for each investment. What investment would be made using the expected value criterion? Note: Excel formula not required for Cell H37. EV(A) = What investment would be made? (A, B, C, or D) EV(B) - EV(C) - EV(D) - Part c) Given the probabilities in the last row of the payoff table above, compute the expected value of perfect information for each investment. What investment would be made using the expected value of perfect information? Note: Excel formula not required for Cell H49. EV using PI = EVPI(A) - What investment would be made? (A, B, C, or D) EVPI(B) - EVPI(C) = EVPI(D)= Part d) Fill in the regret for each investment and economic condition in the table below. Regret Table Economic Conditions Investment Poor Average Good Excellent A