only problems 22 and 24

3-22 Waldo Books needs to decide how many copies of a new hardcover release to purchase for its shelves. The store has assumed that demand will be 50, 100, 150, or 200 copies next month, and it needs to decide whether to order 50, 100, 150, or 200 books for this period. Each book costs Waldo $20 and can be sold for $30. Waldo can sell any unsold books back to the supplier for $4. (a) Which option should Waldo choose if it uses the maximax citerion? (b) Which option should Waldo choose if it uses the maximin criterion? (c) Which option should Waldo choose if it uses the equally likely criterion? (d) Which option should Waldo choose if it uses the criterion of realism with a = 0.7? (e) Which option should Waldo choose if it uses the minimax regret criterion? 3-23 After researching the market, Waldo Books (see Problem 3-21) has concluded that the probabilities of selling 50, 100, 150, and 200 books next month are 0.2, 0.35, 0.25 and 0.2. respectively (a) Using EMVs, how many books should Waldo order? (b) Using EOL, how many books should Waldo order? (c) Compute Waldo's EVwPI and EVPL. 3-24 A souvenir retailer has an opportunity to establish a new location inside a large airport. The annual returns will depend primarily on the size of the space she rents and if the economy will be favorable. The retailer has worked with the airport concession commission, and has projected the following possi- ble annual carnings associated with renting a a small medium, large, or very large space: GOOD ECONOMY FAIR ECONOMY SIZE POOR ECONOMY Small Medium Large Very large $ 70,000 SI 12.000 S140,000 $420,000 $28,000 S42.000 $42.000 $35.000 - 14.000 -$ 28,000 -$ 56,000 -$224,000 (a) What is the souvenir retailer's maximax decision? (b) What is her maximin decision? (e) What is her equally likely decision? (d) What is her criterion of realism decision, using 0.87 (e) What is her minimax regret decision