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Case Study:Waldo books

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Question;Case Study: Waldo Books;Waldo Books needs to decide how many copies of a new hardcover release to purchase;for its shelves. The store has assumed that demand will be 50, 100, 150, or 200 copies;next month and they need to decide whether to order 50, 100, 150 or 200 books for this;period. Each book costs Waldo $20 and can be sold for $30. Waldo can sell any unsold;books back to their supplier for $4.;a) Which option should Waldo choose if they use the maximax criterion?;b) Which option should Waldo choose if they use the maximin criterion?;c) Which option should Waldo choose if they use the equally likely;criterion?;d) Which option should Waldo choose if they use the minimax regret;criterion?;e) Which option should Waldo choose if they use the criterion of realism;with _ = 0.7?

 

Paper#36353 | Written in 18-Jul-2015

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