Use this information to answer the following questions.
A plant manager is considering buying additional stamping machines to accommodate increasing demand.The alternatives are to buy 1 machine,2 machines,or 3 machines.The profits realized under each alternative are a function of whether their bid for a recent defense contract is accepted or not.The payoff table below illustrates the profits realized (in $000's)based on the different scenarios faced by the manager.
$$\begin{array} { l c c }
\text { Alternative } & \text { Bid Accepted } & \text { Bid Rejected } \
\hline \text { Buy 1 machine } & \$ 10 & \$ 5 \
\text { Buy 2 machines } & \$ 30 & \$ 4 \
\text { Buy 3 machines } & \$ 40 & \$ 2
\end{array}$$
-Refer to the information above.
a.Which alternative should be chosen based on the maximax criterion?
b.Which alternative should be chosen based on the maximin criterion?
c.Which alternative should be chosen based on the Lapalce criterion?
d.Which alternative should be chosen based on criterion of realism with alpha = 0.8?
e.Which alternative should be chosen based on the minimax regret criterion?

Question

Use this information to answer the following questions.
A plant manager is considering buying additional stamping machines to accommodate increasing demand.The alternatives are to buy 1 machine,2 machines,or 3 machines.The profits realized under each alternative are a function of whether their bid for a recent defense contract is accepted or not.The payoff table below illustrates the profits realized (in $000's)based on the different scenarios faced by the manager.
 $$\begin{array} { l c c } 
\text { Alternative } & \text { Bid Accepted } & \text { Bid Rejected } \
\hline \text { Buy 1 machine } & \$ 10 & \$ 5 \
\text { Buy 2 machines } & \$ 30 & \$ 4 \
\text { Buy 3 machines } & \$ 40 & \$ 2
\end{array}$$
-Refer to the information above.
a.Which alternative should be chosen based on the maximax criterion?
b.Which alternative should be chosen based on the maximin criterion?
c.Which alternative should be chosen based on the Lapalce criterion?
d.Which alternative should be chosen based on criterion of realism with alpha = 0.8?
e.Which alternative should be chosen based on the minimax regret criterion?

Quizplus · Accepted Answer

The Answer of Use this information to answer the following questions.
A plant manager is considering buying additional stamping machines to accommodate increasing demand.The alternatives are to buy 1 machine,2 machines,or 3 machines.The profits realized under each alternative are a function of whether their bid for a recent defense contract is accepted or not.The payoff table below illustrates the profits realized (in $000's)based on the different scenarios faced by the manager.
 $$\begin{array} { l c c } 
\text { Alternative } & \text { Bid Accepted } & \text { Bid Rejected } \
\hline \text { Buy 1 machine } & \$ 10 & \$ 5 \
\text { Buy 2 machines } & \$ 30 & \$ 4 \
\text { Buy 3 machines } & \$ 40 & \$ 2
\end{array}$$
-Refer to the information above.
a.Which alternative should be chosen based on the maximax criterion?
b.Which alternative should be chosen based on the maximin criterion?
c.Which alternative should be chosen based on the Lapalce criterion?
d.Which alternative should be chosen based on criterion of realism with alpha = 0.8?
e.Which alternative should be chosen based on the minimax regret criterion?

Use This Information to Answer the Following Questions -Refer to the Information Above