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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 (in
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-s1, s2, and s3. The probability of the occurrence of s1 is 0.1, and the probability of the occurrence of s2 is 0.3. Determine the expected value of the best decision.
States of Nature | |||
Decision | s1 | s2 | s3 |
d1 | 18 | 28 | 30 |
d2 | 19 | 17 | -5 |
d3 | 3 | 40 | 16 |
Group of answer choices
21.9
None of the stated answers is correct.
31.9
3.7
28.2
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