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how does the leade-member exchange theory help leaders manage out/ groups how do

ID: 326446 • Letter: H

Question

how does the leade-member exchange theory help leaders manage out/ groups how does the leade-member exchange theory help leaders manage out/ groups Quiz Answer any two of the following Roman numeral questions (I, II, III). Equal credit (50 points each). You may answer a third for a potential bonus of 20 points. I. A payoff table is given as St 250 300 350 500 700 500 600 350 d2 250 250 a. What choice should be made by the conservative decision maker? b. What decision should be made under minimax regret? c. If the probabilities of si, s2, and s are 333.333, and.333, respectively then what choice should be made under expected value? Il. Using the table above, calculate the expected value of perfect information. IIl. Using the table above, explain which choice should be made using the Hurwitz method, in which the coefficient of optimism is.6?

Explanation / Answer

a) Conservation decision maker or Pessimistic approach: Determine the worst possible payoff for each alternative, and choose the alternative that has the “best worst.”

d1 = 250

d2 = -250

d3 = 350

So, d3 is the best

b) Minimax Regret: Determine the worst regret for each alternative, and choose the alternative with the “best worst.” The first step in this approach is to prepare a table of regrets (or opportunity losses ). To do this, subtract every payoff in each column from the best payoff in that column.

d1 = 200

d2 = 750

d3 = 100

The lowest regret is of d3. So, d3 is best

c) In this, for each decision multiple the probabilities with values:

d1 = 0.333*250 + 0.333*350 + 0.333*500 = 366.67

d2 = 0.333*300 + 0.333*-250 + 0.333*700 = 250

d3 = 0.333*350 + 0.333*500 + 0.333*600 = 483.33

SO, d3 is the best

s1 s2 s3 d1 100 150 200 d2 50 750 0 d3 0 0 100