Wednesday
October 1, 2014

Homework Help: statistics

Posted by In Desperate Need Deena on Saturday, September 24, 2011 at 2:14pm.

You have available five different investment strategies and their respective payoffs for various states-of-nature as shown in the chart below. Which investment would you make under the different decision criteria?

States of Nature

Sever
Decline Moderate Decline Stable Moderate Advance Strong Advance
T-Bills 3.50 3.50 3.50 3.50 3.50
Paragon (22.50) (2.00) 20.00 35.00 50.00
Luster 28.00 14.70 0.00 (10.00) (20.00)
Apex 10.00 5.00 7.00 45.00 30.00
Market (13.00) 5.00 22.00 38.00 Portfolio 47.00

Probability 0.05 0.35 0.30 0.20 0.10

Note: For the following questions, ¡§Investment¡¨ is the name of the strategy not the number, i.e., Luster, Apex, etc.

a)Maximin criteria

Answer: Investment

b)Maximax criteria

Answer:Investment

c)Equally Likely criteria
Answer:Investment

d)Criterion of realism (assume Ą = 0.6)
Answer:Investment

e)Minimax regret criteria
Answer:Investment

f)Criterion of maximum expected value
Answer:Investment

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

Statistics - You have available five different investment strategies and their ...
Decision Criteria - You have available five different investment strategies and ...
Decision Criteria - You have available five different investment strategies and ...
Math - You have available five different investment strategies and their ...
marketing - Describe five different investment strategies. Which of these ...
Accounting - Assume a $4000 investment and the following cash flows for two ...
Maths B - Kate is thinking about investing $45000 for 5 years. She deposits her ...
Finance - Assume a $4,000 investment and the following cash flows for two ...
Math - Becky has saved $4500. She would like to earn $325 per year, by ...
Pre-Algebra [Permutations] - 1.A furniture store sells couches that are ...

Search
Members