Exhibit 20-1
Below you are given a payoff table involving two states of nature and three decision alternatives. The probability of occurrence of S 1 = 0.2.
-Refer to Exhibit 20-1. The expected value of alternative A is
A)7.4
B)11.6
C)8.8
D)13

Question

Exhibit 20-1
Below you are given a payoff table involving two states of nature and three decision alternatives.  The probability of occurrence of S 1 = 0.2.
-Refer to Exhibit 20-1. The expected value of alternative A is
A)7.4 
B)11.6 
C)8.8 
D)13

Quizplus · Accepted Answer

The expected value is calculated by multiplying each outcome by its probability and summing the results.

Exhibit 20-1 Below You Are Given a Payoff Table Involving Two States