MIS 344 Homework#1
jam007 (Not rated)
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1. Figure 3.5 is complete decision tree for John Thompson. After completing the analysis John is not sure about the risk. After going through a number of standard gambles, John was able to assess his utility for money. Here are some of the utility assessments:
U(-$190,000)= 0,
U(-$180,000)= 0.05,
U(-$30,000)= 0.10,
U(-$20,000)= 0.15,
U(-$10,000)= 0.20,
U($0)= 0.30,
U($90,000)= 0.50,
U($100,000)= 0.60,
U($190,000)= 0.95,
U($200,000)= 1.00.
If John maximizes his expected utility, does his decision change?
- 10 years ago
Decision Theory_ Expected Utility
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