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Consider a case where the management is facing with 3

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Consider a case where the management is facing with 3 options to choose from. The payoffs and probability associated with each of the scenario is also estimated and provided. Based on the information tabulated below, calculate the EVwPI (expected value with perfect information) and recommend what should be the maximum amount that the management should pay for the perfect information that can help them to make the best decision

State of Nature

Decision Aternative: Favourable Market Unfavorable market

Expensive system: 10000 -8000

Less expensive system : 8000 -4000

No system : 0 0

Probability : 0.4 0.6

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