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Decision Analysis

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A decision maker who is considered to be a risk taker is faced with this set of probabilities and payoffs.

State of Nature
Decision s1 s2 s3
d1 5 10 20
d2 -25 0 50
d3 -50 -10 80
probability 0.30 0.35 0.35

Rank the decision alternatives on the basis of expected value.

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Solution Summary

This solution is comprised of a detailed explanation of the various aspects of Decision Analysis as it pertains to the given problem and provides students with a clear perspective of the calculations and underlying concepts.

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