3. A manager of a company has constructed following payoff table for different a

ID: 3043579 • Letter: 3

Question

3. A manager of a company has constructed following payoff table for different alternatives

altrenative

Which decision manager should take using following methods?

Maximax.

Criterion of realism (Hurwicz) if coefficient of realism is 0.7.

Minimax regret decisions.

4. From the following payoff table

What decision will you take using Expected monetary value method?

What decision will you take using Expected Opportunity loss method?

5. Daily demand for newspapers for the last 5 days given in the following table:

Forecast demand for Friday using a three-day moving average.

Using weight 2 for Wednesday and 3 for Thursday, Forecast demand for Friday using

weighted moving average.

Forecast demand for Friday using simple exponential smoothing assuming that

forecast for Thursday is 9 and smoothing constant = 0.6

6. Complete the following table:

PLEASE I WANT THE ANSWERS WHITHOUT PHOTOS

altrenative

event 1 event 2 altrenative 1 50 -40 altrenative 2 30 -20 altrenative 2 0 0

Q 3)

a) Maximax Criterion

Decision : Alternative 1

b) Criterion of realism (Hurwicz) if coefficient of realism is 0.7

Decision : Alternative 1

c) Minimax regret decisions

The basic steps involve in this criterion are:

1) Determine the amount of regret corresponding to each event for every alternative.

ith regret = Maximum payoff -ith payoff for the jth event

2) Determine the maximum regret amount of each alternative3. Choose the alternative which corresponds to the minimum of the max regrets

Decision : Alternative 2

Alternative Event 1 Event 2 Maximum of Row Alt 1 50 -40 50 Maximum Alt 2 30 -20 30 Alt 3 0 0 0

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