Answer: | maximum of the maximum payoffs | Correct Answer: | maximum of the maximum payoffs | | | | | Question 3 2 out of 2 points | | | The maximin approach to decision making refers toAnswer | | | | | Selected Answer: | maximizing the minimum return | Correct Answer: | maximizing the minimum return | | | | | Question 4 2 out of 2 points | | | The maximax criterion results in the maximum of the minimum payoffs. Answer | | | | | Selected
Premium Decision theory Game theory
Ensure decisions lead to good outcomes. | c. | Avoiding decisions leading to bad outcomes. | d. | Reduce the role of luck in a decision. | __A__ 3. Which of the following summarizes the final outcome for each decision alternative? a. | payoff matrix | b. | outcome matrix | c. | yield matrix | d. | performance matrix | __A__ 4. Which decision rule optimistically assumes that nature will always be "on our side" regardless of what decision we make? a. | maximax decision rule
Premium Decision theory Game theory Decision making
* Question 1 2 out of 2 points | | | In general‚ an increase in price increases the break even point if all costs are held constant. Answer | | | | | Selected Answer: | False | Correct Answer: | False | | | | | * Question 2 0 out of 2 points | | | Fixed cost is the difference between total cost and total variable cost. Answer | | | | | Selected Answer: | False | Correct Answer: | True | | | | | * Question 3 0 out of 2 points | |
Premium Normal distribution Variable cost Fixed cost
the house within 7 weeks (49 days)‚ first compute Z 49 mean / std.dev. 49 46 / 7.0789 0.4238 Looking this z-value up in the standard-normal table results in a probability of 0.664 for selling the house within 7 weeks. Question 2 (e) To determine this value‚ first find a z-value in the standard-normal table such that the area to the left is 0.95. That z-value is 1.645. Then‚ the
Premium Inventory Decision theory Decision tree
P A R T I V QUANTITATIVE MODULES Quantitative Module Decision-Making Tools A Module Outline THE DECISION PROCESS IN OPERATIONS FUNDAMENTALS OF DECISION MAKING DECISION TABLES TYPES OF DECISION-MAKING ENVIRONMENTS Decision Making Under Uncertainty Decision Making Under Risk Decision Making Under Certainty Expected Value of Perfect Information (EVPI) DECISION TREES A More Complex Decision Tree Using Decision Trees in Ethical Decision Making SUMMARY KEY TERMS USING SOFTWARE FOR DECISION
Premium Decision theory Decision making
decision-makers of economic agents in specific situations‚ analyzing outcomes of mathematical models of conflict and cooperation (Myerson‚ 1991). Its basic elements include players‚ actions‚ information‚ strategies‚ payoffs‚ outcome and equilibrium‚ among which‚ players‚ strategies and payoffs are the most essential; actions and outcome are called as rules of the game (Rasmusen‚ 2000). The objective of the model is to establish equilibrium with the use of rules of the games. Nash equilibrium‚ an important
Premium Game theory Nash equilibrium
only 300 rooms instead of 400. d. adjust short run marginal cost the long run marginal cost. 1. Consider the following payoff table. In this table‚ Player 1’s payoffs are written FIRST in each pair. Player 2 Strategy High Price Low Price Player 1 High Price (10‚ 10) (5‚-5) Low Price (-5‚ 5) (0‚ 0) 2. Which of the following is Nash equilibirum payoffs in a one-shot game? a. (0‚ 0) b. (5‚ -5) c. (-5‚ 5) d. (10‚ 10) QUESTION 21 1. You are the manager
Premium Economics Supply and demand Elasticity
reflect the decision maker’s perspective and attitude toward risk. Each payoff is assigned a utility value. Higher payoffs get larger utility value. The optimal decision is the one that maximizes the expected utility. Determining Utility Values The technique provides an insightful look into the amount of risk the decision maker is willing to take. The concept is based on the decision maker’s preference to taking a sure payoff versus participating in a lottery. Determining Utility Values Indifference
Premium Decision theory Decision making Risk
Chapter 8. Mini-Case Assume that you have just been hired as a financial analyst by Triple Play Inc.‚ a mid-sized California company that specializes in creating high-fashion clothing. Because no one at Triple Play is familiar with the basics of financial options‚ you have been asked to prepare a brief report that firm’s executives can use to gain a cursory understanding of the topic. To begin‚ you gathered some outside materials on the subject and used these materials to draft a list of pertinent
Premium Option Call option Put option
Financial Derivatives DERIVATIVE SECURITY: A derivative security is a security whose value is contingent on the value of other more basic underlying variables. Hence derivatives are also known as contingent claims. Very often the variables underlying derivatives securities are the prices of traded securities. For example‚ stock option. Futures and Options ⇒⇒⇒⇒⇒⇒ actively traded on the many different exchanges. Forward Contracts‚ Swaps ⇒⇒⇒⇒⇒ traded outside of exchanges by financial Institutions
Premium Futures contract