Which of the following statements is correct?
A) The EMV criterion selects the act with the smallest expected monetary value.
B) The EOL criterion selects the act with the smallest expected opportunity loss.
C) The expected value of perfect information (EVPI) equals the largest expected opportunity loss.
D) All these choices are correct.

Question

Quizplus · Accepted Answer

The statement "The EOL criterion selects the act with the smallest expected opportunity loss" is correct. The EMV criterion selects the act with the highest expected monetary value, and the EVPI is the largest amount a decision maker should be willing to pay for perfect information. Therefore, choice A and C are incorrect.

Which of the Following Statements Is Correct