A manager needs to hire short-term employees to meet production demands.The manager would like to hire one of three possible short-term workers.Ten hours are demanded with 50% probability,20 hours are demanded with 30% probability,and 30 hours are demanded with 20% probability.The table below represents the alternatives and possible states of nature. a)Which alternative will minimize the expected monetary value?
b)What is the expected value of perfect information?

Question

A manager needs to hire short-term employees to meet production demands.The manager would like to hire one of three possible short-term workers.Ten hours are demanded with 50% probability,20 hours are demanded with 30% probability,and 30 hours are demanded with 20% probability.The table below represents the alternatives and possible states of nature.  a)Which alternative will minimize the expected monetary value?
b)What is the expected value of perfect information?

Quizplus · Accepted Answer

The Answer of A manager needs to hire short-term employees to meet production demands.The manager would like to hire one of three possible short-term workers.Ten hours are demanded with 50% probability,20 hours are demanded with 30% probability,and 30 hours are demanded with 20% probability.The table below represents the alternatives and possible states of nature.  a)Which alternative will minimize the expected monetary value?
b)What is the expected value of perfect information?

A Manager Needs to Hire Short-Term Employees to Meet Production