The _______________________ is the difference between the expected payoff that would have been realized had the best alternative action been selected if we know which state of nature has occurred and the expected payoff under risk.
A)expected monetary value
B)expected value of perfect information
C)expected value of sample information
D)expected net gain of sampling

Question

Quizplus · Accepted Answer

The expected value of perfect information (EVPI) measures the difference between the expected payoff under certainty (i.e., perfect information) and the expected payoff under risk. It represents the maximum amount that one would be willing to pay for additional information that would enable them to make the best possible decision. The other options mentioned are not relevant to the definition given in the question.

The _______________________ Is the Difference Between the Expected Payoff That