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Andrew Thomas, a sandwich vendor at Hard Rock Cafe's annual Rockfest, created a table of conditional values for the various alternatives (stocking decision) and states
Andrew Thomas, a sandwich vendor at Hard Rock Cafe's annual Rockfest, created a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd): States of Nature (demand) Big $22,000 $16,000 $8,400 Small -$2,500 Alternatives Large Stock Average Stock Small Stock Average $12,000 $11,000$6,500 S8,100 $4,000 The probabilities associated with the states of nature are 0.20 for a big demand, 0.45 for an average demand, and 0.35 for a small demand. a) The alternative that provides Andrew Thomas the greatest expected monetary value (EMV) is The EMV of this decision is (enter your answer as a whole number). b) The expected value of perfect information (EVPI) for Andrew Thomas (enter your answer as a whole number)
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