Question

Which act(s) should be chosen in the decision problem below according to the following decision rule: (a) the maximin rule (b) maximax (c) minimax regret (d) the optimism-pessimism rule (for $\alpha>1 / 4$ ) (e) the principle of insufficient reason. $$ \begin{array}{rrrrr} \hline a_1 & 20 & 20 & 0 & 10 \\ a_2 & 10 & 10 & 10 & 10 \\ a_3 & 0 & 40 & 0 & 0 \\ a_4 & 10 & 30 & 0 & 0 \\ \hline \end{array} $$

    Which act(s) should be chosen in the decision problem below according to the following decision rule:
(a) the maximin rule
(b) maximax
(c) minimax regret
(d) the optimism-pessimism rule (for $\alpha>1 / 4$ )
(e) the principle of insufficient reason.
$$
\begin{array}{rrrrr}
\hline a_1 & 20 & 20 & 0 & 10 \\
a_2 & 10 & 10 & 10 & 10 \\
a_3 & 0 & 40 & 0 & 0 \\
a_4 & 10 & 30 & 0 & 0 \\
\hline
\end{array}
$$

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An Introduction to Decision Theory

An Introduction to Decision Theory

Martin Peterson 1st Edition

Chapter 3, Problem 1

Instant Answer

Step 1

First, let's calculate the payoffs for each act: $$ \begin{array}{rrrrr} \hline a_1 & 20 & 20 & 0 & 10 \\ a_2 & 10 & 10 & 10 & 10 \\ a_3 & 0 & 40 & 0 & 0 \\ a_4 & 10 & 30 & 0 & 0 \\ \hline \end{array} $$ Show more…

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Which act(s) should be chosen in the decision problem below according to the following decision rule: (a) the maximin rule (b) maximax (c) minimax regret (d) the optimism-pessimism rule (for $\alpha>1 / 4$ ) (e) the principle of insufficient reason. $$ \begin{array}{rrrrr} \hline a_1 & 20 & 20 & 0 & 10 \\ a_2 & 10 & 10 & 10 & 10 \\ a_3 & 0 & 40 & 0 & 0 \\ a_4 & 10 & 30 & 0 & 0 \\ \hline \end{array} $$

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