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A firm has three investment alternatives (d1,d2,d3). Payoffs are in thousands of dollars: Decision Alternative (1) - Investment A, d1 Up, s1 - 100 Stable,
A firm has three investment alternatives (d1,d2,d3). Payoffs are in thousands of dollars:
Decision Alternative (1) - Investment A, d1
Up, s1 - 100
Stable, s2 - 25
Down, s3 - 0
Decision Alternative (2) - Investment B, d2
Up, s1 - 75
Stable, s2 - 50
Down, s3 - 25
Decision Alternative (3) - Investment C, d3
Up, s1 - 50
Stable, s2 - 50
Down, s3 - 50
Probabilities
Up, s1 - 0.40
Stable, s2 - 0.30
Down, s3 - 0.30
What is the utility of a payoff of 25 for decision maker B? U(100) = 10 and U(0) = 0
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