90.2K

Verified Solution

Link Copied!

QUESTION 3: Decision Analysis (14 points) Mr. Cormier was 58 years old this past Monday. Mr. Cormier's family has a history of heart problems. After recently experiencing some discomfort at work, Mr. Cormier decided to see his doctor. On Thursday, Mr. Cormier learned that his "bad" cholesterol was high. Dr. Walla presented him with a choice: (1) severe and immediate carbohydrate reduction diet, or (2) gradual reduction in carbs intake from a slow-change diet with anti-cholesterol pill supplements. The doctor believed that if Mr. Cormier strictly followed either of these options, then he could indeed end up with no cholesterol problem. Alternatively, his cholesterol problems might well continue under any strategy. The doctor told him that they would have to monitor the situation. Mr. Cormier considered the "do nothing" option and the "no cholesterol problem" state as most desirable, and he assigned it a consequence score of +10. Since it would be difficult to go on the "severe diet", he assessed the score of "severe diet" and the "no cholesterol problem" state as only +7, and finally, since he did not like taking pills, he assessed the score of "gradual diet + pills strategy and the "no cholesterol problem" state as only +8. He also gave a score of -9 to the case of "continuing cholesterol problems" under the "severe diet" option while assigning a score of -15 for the "continuing cholesterol problems" after the gradual diet" option that included taking pills. Finally, he assigned a score of -12 to the "do nothing" and the continuing cholesterol problems" outcome. a) Using the information above, advise Mr. Cormier on which of Dr. Walla's options to carry out by providing the payoff table (decision table) and analyzing the problem. Justify your selection of the appropriate decision criterion. Show your work and provide your recommendation. (7 points) At home, Mr. Cormier's son, Claude, did a thorough Google search on his father's condition and found some new information about the effectiveness of the 3 medical options. He summarized the information in the form of the probabilities of ending in "no cholesterol problem" conditional on having followed the medical options below: 1. 60% after the severe diet; 2. 45% after the gradual diet with pills: 3. 1% after doing nothing. Note: It is assumed that there are only 2 possible outcomes, namely: (1) "no cholesterol problem", or (2) "continuing cholesterol problems". b) Using the additional information from Claude's Google search draw the decision tree for this D QUESTION 3: Decision Analysis (14 points) Mr. Cormier was 58 years old this past Monday. Mr. Cormier's family has a history of heart problems. After recently experiencing some discomfort at work, Mr. Cormier decided to see his doctor. On Thursday, Mr. Cormier learned that his "bad" cholesterol was high. Dr. Walla presented him with a choice: (1) severe and immediate carbohydrate reduction diet, or (2) gradual reduction in carbs intake from a slow-change diet with anti-cholesterol pill supplements. The doctor believed that if Mr. Cormier strictly followed either of these options, then he could indeed end up with no cholesterol problem. Alternatively, his cholesterol problems might well continue under any strategy. The doctor told him that they would have to monitor the situation. Mr. Cormier considered the "do nothing" option and the "no cholesterol problem" state as most desirable, and he assigned it a consequence score of +10. Since it would be difficult to go on the "severe diet", he assessed the score of "severe diet" and the "no cholesterol problem" state as only +7, and finally, since he did not like taking pills, he assessed the score of "gradual diet + pills strategy and the "no cholesterol problem" state as only +8. He also gave a score of -9 to the case of "continuing cholesterol problems" under the "severe diet" option while assigning a score of -15 for the "continuing cholesterol problems" after the gradual diet" option that included taking pills. Finally, he assigned a score of -12 to the "do nothing" and the continuing cholesterol problems" outcome. a) Using the information above, advise Mr. Cormier on which of Dr. Walla's options to carry out by providing the payoff table (decision table) and analyzing the problem. Justify your selection of the appropriate decision criterion. Show your work and provide your recommendation. (7 points) At home, Mr. Cormier's son, Claude, did a thorough Google search on his father's condition and found some new information about the effectiveness of the 3 medical options. He summarized the information in the form of the probabilities of ending in "no cholesterol problem" conditional on having followed the medical options below: 1. 60% after the severe diet; 2. 45% after the gradual diet with pills: 3. 1% after doing nothing. Note: It is assumed that there are only 2 possible outcomes, namely: (1) "no cholesterol problem", or (2) "continuing cholesterol problems". b) Using the additional information from Claude's Google search draw the decision tree for this D

Answer & Explanation Solved by verified expert

See Answer