The profit payoff table showing profit for a decision problem with four states of nature and four decision alternatives presented below;
------------------------------------------------------------------=-----------------------------------------
State of Alternative
Nature -----------------------------------------------------------------------------
A1 A2 A3 A4
------------------------------------------------------------------------------------------------------------
S1 35 42 25 38
S2 36 30 45 52
S3 43 33 33 30
S4 40 25 35 42
-------------------------------------------------------------------------------------------------------------
Recommend a decisions using the criteria below;
Maximim criterion
Maximac criterion
Hurwick criterion (α =0.70)
Laplace criterion
Minimim criterion (EOL Table)
Assume the probabilities for every state of nature are knows, (S1=0.1, S2=0.3,
S3=0.3 and S4=0.3). Find the best alternative with EMV and EOL table.
c. Based on the results, which alternative is the best alternative? State your reasons.