Question

Reconsider the Goferbroke Co. prototype example, including the application of utilities in Sec. 16.6. The owner now has decided that, given the company’s precarious financial situation, he needs to take a much more risk-averse approach to the problem. Therefore, he has revised the utilities given in Table 16.7 as follows: U(–130) = 0, U(–100) = 0.1, U(60) = 0.4, U(90) = 0.45, U(670) = 0.985, and U(700) = 1.
(a) Analyze the revised decision tree corresponding to Fig. 16.16 by hand to obtain the new optimal policy.
(b) Use ASPE to construct and solve this revised decision tree.


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  • CreatedSeptember 22, 2015
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