Suppose that in question 30, you have assigned the probabilities of .2 to low movie attendance, .5 to average movie attendance, and .3 to high movie attendance.

Use the expected monetary value criterion to determine when the studio should release the movie.

Question 30

A studio that has just produced a new movie must decide when to release it. The possible actions are

(a) Which of these actions will the studio choose if it uses the minimax criterion?

(b) Which of these actions will the studio choose if it uses the maximin criterion?

Transcribed Image Text:

A: release the movie in the spring A: release the movie in the fall A3: release the movie at Christmas time A4: release the movie in the summer The possible states of nature are S: low movie attendance S: average movie attendance S3: high movie attendance The payoff table is Action A A A3 A4 State of nature S -20 10 25 20 S 10 10 35 19 S3 20 10 45 40