Question: Problem 1: Silicone Dynamics has developed a new computer chip that will enable it to begin producing and marketing a tablet computer. Alternatively, it can

Problem 1: Silicone Dynamics has developed a new

Problem 1: Silicone Dynamics has developed a new computer chip that will enable it to begin producing and marketing a tablet computer. Alternatively, it can sell the rights to the computer chip for $15 million. If the company chooses to build computers, the profitability of the venture depends on the company's ability to market the computer during the first year. It has sufficient access to retail outlets that can generate sales of 10,000 computers. On the other hand, if this computer catches on, which happens with a 0.3 chance, the company can sell 100,000 computers. The fixed cost of setting up the assembly line is $6 million. The profit (i.e., difference between the selling price and the variable cost) of each computer is $600. a. Construct Silicone Dynamics's payoff table. b. [3 points each] Recommend what decision to make by applying "Maximax" criterion? "Maximin" criterion? Maximum Likelihood Criterion? Bayes' rule

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