This payoff matrix gives potential dollar gain values in thousands for strategies S1, S2, S3, and S4 for Sam's Pizza and competitive strategies CA1, CA2, and CA3 for Pam's Pizza. What is the maximum regret value for S2?
A) 24
B) 15
C) 5
D) 0

Question

This payoff matrix gives potential dollar gain values in thousands for strategies S1, S2, S3, and S4 for Sam's Pizza and competitive strategies CA1, CA2, and CA3 for Pam's Pizza. What is the maximum regret value for S2? 
A) 24 
B) 15 
C) 5 
D) 0

Quizplus · Accepted Answer

A) The regret value shows the maximum amount that Sam can lose by making the wrong choice. In this case, the difference between the CA1 value of 7 and the CA3 value of 31 gives the maximum regret of 24 for S2, meaning the most that could have been lost had Sam not chosen S2 would have been 24 thousand dollars.

This Payoff Matrix Gives Potential Dollar Gain Values in Thousands