NyX Cosmetic has built business plans for Black Friday. Based on current market demand, NyX has designed 4 plans for 4 different main cosmetic products, including the expected profit that each plan brings in each situation and the probability of demand in each market, shown in the table below.
States of nature
Alternatives 1 2 3 4
Foundations -$10 $150 $250 $200
Lipsticks $300 $100 $200 -$20
Eyeliners $150 $200 $250 $100
Blusher $200 $100 -$50 $150
Probabilities 0.3 0.2 0.25 0.3
RieMarr is a market demand research company, offering NyX precise data with a price of $80.
Should NyX buy that data? Why?
Yes, because the expected value of perfect information is $85.
No, because RieMarr's data price is $10 higher than the expected value of perfect information.
Yes, because the expected value of perfect information is $5 higher than RieMarr's data price.
No, because the expected value of perfect information is $5 lower than RieMarr's data price.