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what does the value of perfect information means ? and value of imperfect information ?
If you can find out what is going to happen before you make the decision (by, for example, doing market research first) then you could make better decisions (and make more profit). The extra profit you could make is the value of the information (and also the most you would be prepared to pay for it.
Perfect information is the case where the market research was 100% accurate. In practice, although you would expect it to be reasonably accurate, you will never be 100% certain it is correct – in this case we call it imperfect information.
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