# T4-6 & T4-7 Payoff Table

The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature.

States A1 A2 A3

1 12 -2 8

2 4 10 5

Where: S1 is state of nature 1 A1 is action alternative 1

S2 is state of nature 2 A2 is action alternative 2

A3 is action alternative 3

T4-6 Referring to the table above, if the probability of S1 is 0.2 and S2 is 0.8, then the expected opportunity loss (EOL) fro A1 is

A. 0

B. 1.2

C. 4.8

D. 5.6

T4-7 Referring to the table above, if the probability of S1 is 0.5, then the expected monetary value (EMV) for A1 is

A. 3

B. 4

C. 6.5

D. 8

https://brainmass.com/statistics/probability/payoff-table-90114

#### Solution Summary

This solution contains the calculation and answers to the multiple choice question, T4-6 is completed in an attached Word document.

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