Paragraph Styles Font Ed 7 Here are the results of an AHP elicitation: 4 3 6 2-3 to the Texaco-Pennzoil example from Chapter 4 and think about Let us return edtke's risk attitude. Of course, Liedtke is not operating by himself in the Texaco- case; he must report to a board of directors. Draw graphs of these. There are two directors. We capture their distributions where R- 3 and 10, respectively risk utility function using exponential FIGURE 4.2 Hugh Liedtke's decision tree with chances (probabl des) included a. Complete the matrix. b. Compute the weights using the geometric mean method. Please compute it by hand. We don't need the answer from LDW which can be different. c Compute the consistency ratio. 5 Biln a2 103 Tasace d. Use the information from the matrix to compute the equivalent swing weights. You should assume that the appropriate range of variation was considered in the elicitation a (10 points) Use two utility functions in conjunction with the decision tree sketched in Figure 4.2 to solve this problem With these utilities, what strategy will each director use? b. (10 points) What are the risk premium of both directors utility Paragraph Styles Font Ed 7 Here are the results of an AHP elicitation: 4 3 6 2-3 to the Texaco-Pennzoil example from Chapter 4 and think about Let us return edtke's risk attitude. Of course, Liedtke is not operating by himself in the Texaco- case; he must report to a board of directors. Draw graphs of these. There are two directors. We capture their distributions where R- 3 and 10, respectively risk utility function using exponential FIGURE 4.2 Hugh Liedtke's decision tree with chances (probabl des) included a. Complete the matrix. b. Compute the weights using the geometric mean method. Please compute it by hand. We don't need the answer from LDW which can be different. c Compute the consistency ratio. 5 Biln a2 103 Tasace d. Use the information from the matrix to compute the equivalent swing weights. You should assume that the appropriate range of variation was considered in the elicitation a (10 points) Use two utility functions in conjunction with the decision tree sketched in Figure 4.2 to solve this problem With these utilities, what strategy will each director use? b. (10 points) What are the risk premium of both directors utility