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1- Two Decision Alternatives and Three States of Nature. The following payoff table shows profit for a decision analysis problem with two decision alternatives and three states of nature:
State of Nature
a. Construct a decision tree for this problem.
b. If the decision-maker knows nothing about the probabilities of the three states of nature, what is the recommended decision using the optimistic, conservative, and minimax regret approaches?
2- Plant Size Decision. Southland Corporation’s decision to produce a new line of recreational products resulted in the need to construct either a small plant or a large plant. The best selection of plant size depends on how the marketplace reacts to the new product line. To conduct an analysis, marketing management has decided to view the possible long-run demand as low, medium, or high. The following payoff table shows the projected profit in millions of dollars:
a. What is the decision to be made, and what is the chance event for Southland’s problem?
b. Construct a decision tree.
c. Recommend a decision based on the use of the optimistic, conservative, and minimax regret approaches.
Instruction: please provide (type) answers to all questions in one Microsoft word file and submit it before the due date stated below. Along with your report (in Microsoft word), please submit all supporting materials (Microsft Excel files).