The construction manager for Acme, Inc. must decide whether to build single-family homes, apartments, or condominiums. She estimates annual profits will vary with the economy, as follows
|
Probabilities
|
30%
|
40%
|
30%
|
|
|
Weak Economy
|
Normal Economy
|
Strong Economy
|
|
Homes
|
$191,000.
|
$86,000.
|
$65,000.
|
|
Apartments
|
$72,000.
|
$164,500.
|
$82,000.
|
|
Condominiums
|
$23,000.
|
$93,500.
|
$202,000.
|
REQUIREMENT:
- Select the best strategy under:
- The Maxi-Min decision criterion.
- The Mini-Max Regret decision criterion.
- The Expected Opportunity Loss decision criterion