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Andrea Dawson, a sandwich vendor at her town's annual Hard Rock Festival, created a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd): Alternatives Large Stock Average Stock Small Stock States of Nature (demand) Average $14,000 $11,000 $8,100 The EMV of this decision is $ Big $18,000 $12,000 $9,000 The probabilities associated with the states of nature are 0.25 for a big demand, 0.50 for an average demand, and 0.25 for a small demand. a) The alternative that provides Andrea Daswon the greatest expected monetary value (EMV) is Small - $2,000 $5,500 $4,000 (enter your answer as a whole number). b) The expected value of perfect information (EVPI) for Andrea Dawson = $ (enter your answe Small Stock

Andrea Dawson, a sandwich vendor at her town's annual Hard Rock Festival, created a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd): Alternatives Large Stock Average Stock Small Stock States of Nature (demand) Average $14,000 $11,000 $8,100 The EMV of this decision is $ Big $18,000 $12,000 $9,000 The probabilities associated with the states of nature are 0.25 for a big demand, 0.50 for an average demand, and 0.25 for a small demand. a) The alternative that provides Andrea Daswon the greatest expected monetary value (EMV) is Small - $2,000 $5,500 $4,000 (enter your answer as a whole number). b) The expected value of perfect information (EVPI) for Andrea Dawson = $ (enter your answe Small Stock

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Andrea Dawson, a sandwich vendor at her town's annual Hard Rock Festival, created a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd): Alternatives Large Stock Average Stock Small Stock States of Nature (demand) Average $14,000 $11,000 $8,100 The EMV of this decision is $ Big $18,000 $12,000 $9,000 Small - $2,000 $5,500 $4,000 The probabilities associated with the states of nature are 0.25 for a big demand, 0.50 for an average demand, and 0.25 for a small demand. a) The alternative that provides Andrea Daswon the greatest expected monetary value (EMV) is (enter your answer as a whole number). b) The expected value of perfect information (EVPI) for Andrea Dawson = $ (enter your answ Small Stock Large Stock Average Stock
Transcribed Image Text:Andrea Dawson, a sandwich vendor at her town's annual Hard Rock Festival, created a table of conditional values for the various alternatives (stocking decision) and states of nature (size of crowd): Alternatives Large Stock Average Stock Small Stock States of Nature (demand) Average $14,000 $11,000 $8,100 The EMV of this decision is $ Big $18,000 $12,000 $9,000 Small - $2,000 $5,500 $4,000 The probabilities associated with the states of nature are 0.25 for a big demand, 0.50 for an average demand, and 0.25 for a small demand. a) The alternative that provides Andrea Daswon the greatest expected monetary value (EMV) is (enter your answer as a whole number). b) The expected value of perfect information (EVPI) for Andrea Dawson = $ (enter your answ Small Stock Large Stock Average Stock
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