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HI Sir
Sales per week
Sales (units) Probability
10 0.3
20 0.5
30 0.2
Selling price: $20 p.u.
Cost: $10 p.u.
Any unsold units must be sold as scrap for $1 p.u.
The company can contract to purchase 10, 20 or 30 units each weekplease I need to know how you calculated the maximum regret here. I can’t figure it out. thx
Have you watched the lecture? (There is no point in using the course notes without the lectures – I go through the example in the lecture and explain it).
I cannot type out the entire lecture here.
We produce the regret table. Since they are regrets (losses) the worst outcome in each case is the maximum (i.e. biggest) regret.
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