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  3. 2: uncertainty uncertainty is when the outcomes ar

2: Uncertainty Uncertainty is when the outcomes are not certain and you are unable to...

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Accounting

2: Uncertainty Uncertainty is when the outcomes are not certain and you are unable to estimate probabilities, but you use your psychological orientation to make decision. If you are optimistic you would make a "maximax" choice. If you are generally a pessimist, you would make a "maximin" choice. You also can make a choice that minimizes your maximum "regret" or make a minimax choice. Use the following information and determine what would be your three choices based on the three psychological orientations (maximax, maximin, and minimax). Show all work. Payoff Table Response: RI R2 R3 Strategy: S1 2242 2235 2199 S2 2021 1645 1652 S3 1998 1767 2209 S4 2136 2199 2240 Maximax: Optimistic Response: Strategy: S1 S2 $3 S4 ANSWER: R1 R2 R3 Maximin: Pessimistic Response: Strategy: SI $2 $3 $4 ANSWER: RI R2 R3 Minimax: Regret Matrix ANSWER Response RI R2 R3 Strategy: S1 $2 $3 S4 55555 Response Strategy RI R2 R3 $2 $4 2

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