For a decision alternative, the weighted average of the payoffs is known as
A)the expected value of perfect information
B)the expected value
C)the expected probability
D)perfect information

Question

Quizplus · Accepted Answer

The weighted average of payoffs is known as the expected value, which is a common method for determining the best decision alternative. It considers the probability of each possible outcome and multiplies it by the payoff associated with that outcome, then adds those products together. The decision alternative with the highest expected value is the best choice.

For a Decision Alternative, the Weighted Average of the Payoffs