I need help with this please Consider the following decision matrix presenting net profit/loss estimates regarding an investment project:DEMANDLOW3010- 50EQUIPMENT USED1. Considering that the probabilities applicable to demand are not known, show the decision recommendationsfrom the points of view of MXMX; MXMN; REALISM at Alpha = .6; EQL LIKE'HD; and MIN. REGRETS. Do yousee a pattern? Which equipment would you choose? Explain.2. Consider now that the probabilities for demand being low, medium and high have been calculated as .25, .30,and .45, respectively. By using a decision tree, find the expected value (XBAR), the standard deviation (SIGMA),and the coefficient of variation (CoV) for each size of equipment. Which size of equipment would you recommendon the basis of the three statistics that you calculated?DMUU:3. Referring to the Z-Table, calculate the probability that each alternative (each different equipment) will turn outat least a $50 profit? What is the likelihood that each alternative will produce a profit BETWEEN $45 and $70?Perfect Optimism:Perfect PessimismOptimism at a=Be sure to show work, indicate the recommended alternative each time, provide a summary table (see below),and support your final statement with a reason.Letter & ValueEqual Likelihood:Minimizing Regret:SmallMediumLargeOverall DMUU:DMUR: ResultsABCBe SureXbarTo Support(Give Reasons!)SigmaMEDIUM406030ReasonYourCOVAnswersHIGH5060120Normal Dist.%(GiveReasons!)Normal Dist.%(GiveReasons!)

“Since you have posted a question with multiple sub-parts, in which subparts also consists of…

Answered: Consider the following decision matrix…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter9: Decision Making Under Uncertainty

Section9.2: Elements Of Decision Analysis

Problem 2P

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