Consider the following decision table with rewards in $ millions. Using the maximin criterion, the appropriate choice would be ___. A)d₁ B)d₂ C)d₃ D)d₄ E)d₅

Question

Quizplus · Accepted Answer

Using the maximin criterion, we select the option with the maximum value in the worst-case scenario. In this case, the worst-case scenario is when the demand is low (D1) and the competitor also chooses the aggressive strategy (U1). Thus, we look for the maximum value in the first column (B1) and choose the option that corresponds to it. Option D has the maximum value of $14 million in the first column, therefore it is the appropriate choice.

Consider the Following Decision Table with Rewards in $ Millions