Nur Athirah Binti Wan Ahmad ( 2016839348)

Exercise past year question Dec 2016

a) Construct a payoff table

State of nature
Alternative
Good market Bad market
Y phone 50 000 15 000
X phone 20 000 4 000

b) Advice Teltech Sdn . Bhd for the best decision using minimax regret criterion.

Opportunity lost

State of nature
Alternative
Good market Bad market
Y phone 50 000 50 000 = 0 15 000 4 000 = 11 000
X phone 50 000 20 000 = 30 000 4 000 4 000 = 0

Max = 30 000 Max = 11 000

the best decision is by choose Y phone