solution
Three decision makers have assessed utilities for the following decision problem (payoff in dollars):
| State of Nature | |||
|---|---|---|---|
| Decision Alternative | S1 | S2 | S3 |
| d1 | 10 | 60 | -20 |
| d2 | 70 | 100 | -90 |
The indifference probabilities are as follows:
| Indifference Probability (p) | |||
|---|---|---|---|
| Payoff | Decision maker A | Decision maker B | Decision maker C |
| 100 | 1.00 | 1.00 | 1.00 |
| 70 | 0.95 | 0.80 | 0.85 |
| 60 | 0.85 | 0.70 | 0.75 |
| 10 | 0.75 | 0.55 | 0.60 |
| -20 | 0.60 | 0.25 | 0.50 |
| -90 | 0.00 | 0.00 | 0.00 |
Find a recommended decision for each of the three decision makers, if P(s1) = 0.25, P(s2) = 0.60, and P(s3) = 0.15. (Note: For the same decision problem, different utilities can lead to different decisions.) If required, round your answers to two decimal places.
| Decision maker A |
| EU(d1) = |
| EU(d2) = |
| Recommended decision: d2 |
| Decision maker B |
| EU(d1) = |
| EU(d2) = |
| Recommended decision: d2 |
| Decision maker C |
| EU(d1) = |
| EU(d2) = |
| Recommended decision: d2 |
I need EU(d1) and EU(d2) for Decision Maker A , B, C
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