Edwards Machine Tools needs to purchase a new machine. The basic model is slower but costs less, while the advanced

model is faster but costs more. Profitability will depend on future demand. The following table presents an estimate of

profits over the next three years.

The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required

analysis to answer the questions below.

Open spreadsheet

Given the uncertainty associated with the demand volume, and no other information to work with, how would you

make a decision using maximax and maximin criteria?

Maximax Decision: Advanced Model $0($

Maximin Decision: Basic Model e

Using the minimax regret criterion, calculate the maximum opportunity loss for each alternative and make a decision.