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Sir I have a query that I desperately need helps with. There’s a question on minimax regret in the textbook.
Now base on the video u posted I understand that the table is a table of regrets
And following your teachings I was able to work out the regret table
However I don’t understand the last scenario
Why is the 105 under D is a positive
If I choose D with a loss of 20 over a profit of 85 isn’t that double loss
Shouldn’t the 105 be a negative or a total of losses
Please refer to tx book question and answer below
A company has three projects to select from
Projects
D. E. FScenarios
1. 100 80 60
2. 90 120 85
3. (20) 10 85Answer
Pay off table
Projects
D. E. FScenarios
1. 0 20 40
2. 30 0 35
3. 105 75 0When calculating the regret table, you take each uncertain item in turn.
So if scenario 3 occurred, then F would be best (with a profit of 85), and so the regret for F would be 0.
If E has been chosen, then they would have only got 10, which is 75 less than 85, so the regret is 75.
If D had been chosen, they they would have lost 20. A loss of 20 is 105 less than 85, and so the regret is 105. (85 – 105 = minus 20)Thank u this was very helpful. I wasn’t looking at it that way. I was putting it in bracket and believe it’s lesser than zero and should have been the package to be selected wit zero regrets.
So can I safely say when doing a regret table of a decision package with a loss end results will be in a positive figure of course representing a regret.
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