Exhibit 14.7
The following questions use the information below.
A decision maker is faced with two alternatives. The decision maker has determined that she is indifferent between the two alternatives when p = 0.45.
-The difference between expected payoff under certainty and expected payoff under risk is
A) EVPI
B) EMV
C) expected regret value
D) none of the above

Question

Exhibit 14.7
The following questions use the information below.
A decision maker is faced with two alternatives. The decision maker has determined that she is indifferent between the two alternatives when p = 0.45. 
-The difference between expected payoff under certainty and expected payoff under risk is
A) EVPI 
B) EMV 
C) expected regret value 
D) none of the above

Quizplus · Accepted Answer

The difference between the expected payoff under certainty and the expected payoff under risk is known as the Expected Value of Perfect Information (EVPI). This measures the value of having complete and perfect information in decision-making scenarios.

Exhibit 14.7 The Following Questions Use the Information Below