Mathematics, 15.04.2020 02:07, rboehm59
Golf Smart sells a particular brand of driver for $200 each. During the next year, it estimates that it will sell 15, 25, 35, or 45 drivers with respective probabilities of 0.35, 0.25, 0.20, n 0.20. They can buy drivers only in lots of 10 from the manufacturer. Batches of 10, 20, 30, 40, and 50 drivers cost $160, $156, $148, $144, and $136 per driver, respectively. Each year, the manufacturer designs a new "hot" driver that depreciates the value of last year's driver. Consequently, at the end of every year, Golf Smart has a clearance sale and is able to sell any unsold drivers for 96 each. Assume that any customer who comes in during the year to buy a driver but is unable due to lack of inventory costs Golf Smart $24 in lost goodwill. Determine what decision should be made under each of the following criteria:
a. Expected value
b. Laplace
c. Maximin
d. Maximax
e. Minimax regret
Answers: 2
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Golf Smart sells a particular brand of driver for $200 each. During the next year, it estimates that...
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