The national sales manager for "I colored this" (ICT) T-shirts provides all salespersons with the payoff table shown next, giving the estimated profit when a retailer purchases from one to four dozen T-shirts. The probability of demand for each state of nature is also shown.

What is the expected payoff for purchasing one dozen T-shirts?
A0
B72
C120
D168

Transcribed Image Text:

PAYOFF TABLE Future Demands 3 4 Probabilities of demands .2 .4 .3 .1 Purchase Quantities 120 120 120 120 240 240 240 -120 120 3 360 360 -240 240 480