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Suppose we are interested in investing in one of three investment opportunities: d1, d2, or d3. The following profit payoff table shows the profits
Suppose we are interested in investing in one of three investment opportunities: d1, d2, or d3. The following profit payoff table shows the profits (in thousands of dollars) under each of the 3 possible economic conditions: 51, 52, and 53. States of Nature Decision Alternative 51 52 53 di 38 28 28 dz 80 60 -10 dy 15 40 16 Assume the states of nature.have the following probabilities: P(s1) = 0.2, P(s2) = 0.3, P(S3) = 0.5. Which decision alternative is best? d d2 d3 O They are equal
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