Ajimatarareje Nigeria Limited wishes to introduce a
new product by replacing the old one and ensures a much higher price (S1), a
moderate high price (S2), small and negligible high price (S3).
The following pay-off table in term of quarterly
profits for the products and strategies is given below:
|
State of
Nature
|
Strategies
|
N1
|
N2
|
N3
|
S1
|
600,000
|
200,000
|
50,000
|
S2
|
400,000
|
300,000
|
100,000
|
S3
|
30,000
|
200,000
|
200,000
|
Probability
|
0.175
|
0.625
|
0.2
|
Required:
Determine the strategy to be adopted using:
a. Maximax
Criterion
b. Maximin
Criterion
c. Minimax
Criterion
d. Minimin
Criterion
e. Minimax
Regret Criterion
f. Maximin
Regret Criterion
g. Laplace
Criterion
h. Hurwicz
Criterion if the coefficient of realism is 75%.
i. Select
the appropriate strategy based on expected monetary value
criterion.
j. Determine
the value of perfect information.
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