Hamburgers are on the menu tomorrow at a school cafeteria and the manager needs to decide how many to have ready for the lunch hour. Each hamburger costs the school $1.85 and is sold for $3.50. Leftover hamburgers have no monetary value. The manager expects demand tomorrow to be 100, 150, 200, or 250 hamburgers and would like to prepare one of these four quantities for lunchtime. If the manager uses the minimax regret criterion, how many hamburgers will be prepared?
A)250
B)200
C)100
D)150

Question

Quizplus · Accepted Answer

The minimax regret criterion involves calculating the regret for each decision and choosing the option with the smallest maximum regret. By preparing 150 hamburgers, the manager minimizes the worst-case regret compared to other quantities.

Hamburgers Are on the Menu Tomorrow at a School Cafeteria