qt assignment.docx - 3 Alternative s Ward A Ward B Ward C Probability Alternative s Ward A Ward B Ward C Probability State of Nature Payoff(RM Mil

qt assignment.docx - 3 Alternative s Ward A Ward B Ward C...

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3. Alternative s State of Nature, Payoff (RM Mil.) EMV Strong market Fair market Poor market Ward A 120 100 40 98 Ward B 90 70 45 75 Ward C 60 60 55 59 Probability 0.5 0.3 0.2 Alternative s State of Nature, Payoff (RM Mil.) EOL Strong market Fair market Poor market Ward A 0 0 15 3 Ward B 30 30 10 26 Ward C 60 40 0 42 Probability 0.5 0.3 0.2 (I) Based on the Maximize Expected Monetary Value model, Hospital Kajang should invest in which has the highest EMV, to maximize expected profit. (II) EVWPI = (120 0.5 100✕ 0.3 55✕ 0.2 ) =101 (III)EVPI =EVWPI – Max EMV =101-98 =3 (IV) Minimum EOL is 3 (V)Three Method Payoff
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4.(I) 0.2 0.2 0.2 0.5 0.5 0.3 0.3 0.5 0.3 hospital kajang Ward A EMV=98 120 100 40 Ward B EMV=75 90 70 45 Ward C
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  • Fall '19
  • Harshad number, Ward B, Max EMV, Maximize Expected Monetary Value model

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