7. A dealer in second-hand machinery is offered 5 machines by a company for Rs 5,000 only....

Question:

7. A dealer in second-hand machinery is offered 5 machines by a company for Rs 5,000 only. He expects to sell each of the machines for Rs 2,200 at a fair but he also knows that any machines not sold would be a waste and not fetch anything later on. Obtain the paY-off matrix under each of the following assumptions:

(a) that the dealer has the option of buying the entire lot onlY, and

(b) that the dealer has the option of buying as many machines as he chooses, at the rate of Rs 1,000 per machine.

Using expectation principle of choice, determine the optimal strategy for the dealer in each of the two cases given.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: