ABC Company, the soft-drink vendor, has developed a table of payoffs for three stocking decisions for three dissimilar states of nature:
|
States of nature (Demand)
|
|
Alternatives
|
Heavy
|
Medium
|
Low
|
|
Large stock
|
$2,060
|
$1,510
|
$1,200
|
|
Average stock
|
$1,390
|
$1,430
|
$1,290
|
|
Small stock
|
$1,560
|
$1,550
|
$1,890
|
Probabilities associated with states of nature are 0.4 for heavy demand, 0.2 for medium demand, and 0.4 for the low demand. What is the expected value with the perfect information? Identify only the amount. e.g. 14000