Using a data table in Excel, perform a sensitivity analysis on the example in Simple Decision Problem.xlsx. Specifically, keep the probabilities in row 10 (for D2) as they are, but vary the probability in cell C11 from 0 to 1 in increments of 0.05, and keep the probabilities in cells D11 and E11 in the same ratio as they are currently (2 to 3).
Answer to relevant QuestionsIn the SciTools example, make two changes: change all references to $115,000 to $110,000, and change all references to $125,000 to $130,000. Rework the EMV calculations and the decision tree. What is the best decision and ...A decision d is said to be dominated by another decision D if, for every outcome, the payoff from D is better than (or no worse than) the payoff from d.a. Explain why you would never choose a dominated decision using the ...For the SciTools example, once you build the tree as in Figure 6.9 and then run a one-way sensitivity analysis with the dialog box filled in as in Figure 6.22, you obtain three strategy charts. Explain exactly what each of ...In the OJ Simpson trial it was accepted that OJ had battered his wife. OJ’s lawyer tried to negate the impact of this information by stating that in a one year period, only 1 out of 2500 battered women are murdered, so the ...The concept behind EVPI is that you purchase perfect information (the envelope), then open the envelope to see which outcome occurs, and then make an easy decision. You do not, however, get to choose what information the ...
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