QUESTION SIX (a) Suppose that a decision is faced with three decision alternatives and four states of nature. The following profit payoff table is constructed: Alternatives State of Nature 1S 2 S 3 S 4 S 1Α 2Α 3Α 18 15 13 12 14 16 15 10 19 8 11 15 Assuming that the decision maker has no knowledge about the probabilities of occurrence of the four states of nature, find the decisions to be recommended under each of the following criteria: iii. Minimax Reject criterion iv. Hurwicz criterion with 0.6 α =
QUESTION SIX (a) Suppose that a decision is faced with three decision alternatives and four states of nature. The following profit payoff table is constructed: Alternatives State of Nature 1S 2 S 3 S 4 S 1Α 2Α 3Α 18 15 13 12 14 16 15 10 19 8 11 15 Assuming that the decision maker has no knowledge about the probabilities of occurrence of the four states of nature, find the decisions to be recommended under each of the following criteria: iii. Minimax Reject criterion iv. Hurwicz criterion with 0.6 α =
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter7: Nonlinear Optimization Models
Section: Chapter Questions
Problem 56P
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QUESTION SIX
(a)
Suppose that a decision is faced with three decision alternatives and four states of nature. The following profit payoff table is constructed:
Alternatives State of Nature
1S 2 S 3 S 4 S
1Α 2Α 3Α
18 15 13
12 14 16
15 10 19
8 11 15
Assuming that the decision maker has no knowledge about the probabilities of occurrence of the four states of nature, find the decisions to be recommended under each of the following criteria:
iii. Minimax Reject criterion
iv.
Hurwicz criterion with 0.6 α =
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