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Schaum's Outlines - Operations Research, 2nd Edition. This book name Assume that prior to making a decision, the manufacturer described in Problem 18.17 pays $1000

image text in transcribedSchaum's Outlines - Operations Research, 2nd Edition. This book name
Assume that prior to making a decision, the manufacturer described in Problem 18.17 pays $1000 for a credit rating report on the retailer. The report rates the retailer as a poor risk, but the manufacturer knows that the rating procedure is not totally reliable. The credit bureau concedes that it will rate an average risk as a poor risk 30 percent of the time, and it will rate a good risk as a poor risk 5 percent of the lime. It will rate a poor risk correctly 90 percent of the time. Based on these data, determine the recommended decision for the manufacturer under the a posteriori criterion. Assume that prior to making a decision, the manufacturer described in Problem 18.17 pays $1000 for a credit rating report on the retailer. The report rates the retailer as a poor risk, but the manufacturer knows that the rating procedure is not totally reliable. The credit bureau concedes that it will rate an average risk as a poor risk 30 percent of the time, and it will rate a good risk as a poor risk 5 percent of the lime. It will rate a poor risk correctly 90 percent of the time. Based on these data, determine the recommended decision for the manufacturer under the a posteriori criterion

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