Question: 1. Suppose that a decision maker faced with two decision alternatives (d1 and d2), and two states of nature (s1 and s2) develops the following

1. Suppose that a decision maker faced with two

1. Suppose that a decision maker faced with two decision alternatives (d1 and d2), and two states of nature (s1 and s2) develops the following profit payoff table: State of Nature Decision Alternatives S1 S2 di 1500 500 d2 780 650 If nothing is known about the probabilities of the two states of nature, what is the recommended decision using: a. Optimistic approach b. Conservative approach c. minimax regret approach QUESTION 2 2. For Question 1, suppose that the decision maker believes that the probability of state of nature si is 0.6 and the probability of state of nature sz is 0.4. Complete the following: a. Draw a decision Tree. b. Use the expected value approach to determine an optimal decision

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