Questions 15 through 20 refer to the following table.

States of Nature

i (prob. = 0.2) ii (prob. = 0.8)

A 8 20

Alternatives B 10 6

C 15 5

D 9 10

1. For this payoff table, what is the expected payoff for alternative B?
2. 8.6
3. 17.6
4. 6.8
5. 16.0

1. What is the expected value of perfect information?
2. 2.6
3. 12.2
4. 1.4
5. 3.5

1. Using the maximin criterion, which alternative will be selected?
2. A
3. B
4. C
5. D

1. Using the maximax criterion, which alternative will be selected?
2. A
3. B
4. C
5. D

1. Using the minimax regret criterion, which alternative will be selected?
2. A
3. B
4. C
5. D

1. What is the expected opportunity loss associated with alternative A?
2. 2.1
3. 1.4
4. 2.8
5. 1.6