1. What selection would an optimist make? 2. What selection would a pessimist make? 3. What selectio
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1. What selection would an optimist make? 2. What selection would a pessimist make? 3. What selection would be nade using the mininax regret approach? Payoff Table States of Nature Low Price High Price Assuming the probabilities of each state of nature are equal, what is the expected payoff for choosing the “High Inventory” option? 5. Assuming the probability of a low price is 0.2, what is the expected payoff for a “Low Inventory approach? Low Inventory 10080 150 200 Medium Inventory 135 SHigh Inventory 75
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