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 maximin criterion, how many hamburgers will be prepared?
A)200
B)100
C)250
D)150

Question

Quizplus · Accepted Answer

The maximin criterion involves selecting the option with the highest minimum payoff. Preparing 100 hamburgers ensures that the manager faces the least potential loss if demand is lower than expected, as any number prepared above actual demand results in a total loss for the excess hamburgers.

Hamburgers Are on the Menu Tomorrow at a School Cafeteria