1.
Question :
Student
Answer:
The “principle of insufficient reason” indicates the decision maker’s belief that
any state of nature is as likely to occur as any other state.
True
Points Received:
False
1 of 1
Comments:
Question 2.Question :
Student
Answer:
The indifference approach for assigning utility values asks the decision maker
which of two alternatives is preferred: the payoff under consideration or a chance
at the highest payoff with a risk of the lowest payoff.
True
Points Received:
False
0 of 1
Comments:
Question 3.Question :
Student Answer:
The fact that so many people enter sweepstakes and/or buy lottery tickets
demonstrates the difference between:
the expected value and the expected utility criteria.
altruism and selfishness.
risk aversion and risk indifference.
certainty and uncertainty.
Points Received:
1 of 1
Comments:
Question 4.Question :
Student Answer:
If it is assumed that each possible state of nature has an equal likelihood of
occurrence, the expected value criterion will yield the same result as:
maximin.
minimax
maximax
the principle of insufficient reason.
Points Received:
1 of 1
Comments:
Question 5.Question :
Student Answer:
The expected value of perfect information (EVPI):
is the same as the expected return with perfect information (ERPI).
is never less than the expected value of sample information (EVSI).
does not require probabilities in its calculation.
requires the availability of sample information.
Points Received:
1 of 1
Comments:
Question 6.Question :
Student
Answer:
An aggressive decision maker would prefer the minimax regret criterion over the
maximin criterion.
True
Points Received:
Comments:
False
1 of 1
Question 7.Question :
Student
Answer:
The states of nature in a payoff table should be mutually exclusive and
collectively exhaustive.
True
Points Received:
False
1 of 1
Comments:
Question 8.Question :
Student Answer:
Utilities are generally well approximated by monetary payoffs for:
risk-averse individuals.
risk-preferring individuals.
small businesses.
large corporations.
Points Received:
0 of 1
Comments:
Question 9.Question :
Student Answer:
Consider the payoff table in chapter 6 problem 7 (page 376). The optimal
decision under the maximin criterion is:
D1
D2
D3
D4
Points Received:
1 of 1
Comments:
Question 10.Question :
Student
True
Answer:
Points Received:
Comments:
The payoff table always has more states of nature than decision alternatives.
False
1 of 1