Bradford Richard
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Chapter 17 review quiz

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Bradford Richard
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Statistics Chapter 17

Question 1 of 25

1

There are three components to any decision:

Select one of the following:

  • 1. the choices available, or alternatives
    2. the states of nature, which are not under the control of the decision maker
    3. the payoffs

  • 1. The goals of the decider
    2. The steps to reach the goal
    3. The risks invovled

  • 1. The total list of options
    2. The option with the best return
    3. Selecting the best option

Explanation

Question 2 of 25

1

Event

Select one of the following:

  • Uncertainty regarding future demand.
    State of nature (future demand) unknown. Decision maker has no control over state of nature.

  • Two or more courses of action open to decision maker. Decision maker must evaluate alternatives.
    Decision maker selects a course of action based on certain criteria.
    Depending on the set of circumstances, these criteria may be quantitative, psychological, sociological, and so on.

  • Profit. Break even. Loss.

Explanation

Question 3 of 25

1

Act

Select one of the following:

  • Uncertainty regarding future demand.
    State of nature (future demand) unknown. Decision maker has no control over state of nature.

  • Two or more courses of action open to decision maker. Decision maker must evaluate alternatives.
    Decision maker selects a course of action based on certain criteria.
    Depending on the set of circumstances, these criteria may be quantitative, psychological, sociological, and so on.

  • Profit. Break even. Loss.

Explanation

Question 4 of 25

1

Outcome Payoff Consequence

Select one of the following:

  • Profit. Break even. Loss.

  • Two or more courses of action open to decision maker. Decision maker must evaluate alternatives.
    Decision maker selects a course of action based on certain criteria.
    Depending on the set of circumstances, these criteria may be quantitative, psychological, sociological, and so on.

  • Uncertainty regarding future demand.
    State of nature (future demand) unknown. Decision maker has no control over state of nature.

Explanation

Question 5 of 25

1

EMV(Ai)

Select one of the following:

  • refers to the expected monetary value of decision alternative, i. There may be many decisions possible. We will let 1 stand for the first decision, 2 for the second, and so on. The lower- case letter i represents the entire set of decisions.

  • refers to the probability of the states of nature. There can be an unlimited number, so we will let j represent this possible outcome.

  • refers to the value of the payoffs. Note that each payoff is the result of a combination of a decision alternative and a state of nature.

Explanation

Question 6 of 25

1

P(Sj)

Select one of the following:

  • refers to the probability of the states of nature. There can be an unlimited number, so we will let j represent this possible outcome.

  • refers to the value of the payoffs. Note that each payoff is the result of a combination of a decision alternative and a state of nature.

  • refers to the expected monetary value of decision alternative, i. There may be many decisions possible. We will let 1 stand for the first decision, 2 for the second, and so on. The lower- case letter i represents the entire set of decisions.

Explanation

Question 7 of 25

1

V(Ai, Sj)

Select one of the following:

  • refers to the value of the payoffs. Note that each payoff is the result of a combination of a decision alternative and a state of nature.

  • refers to the probability of the states of nature. There can be an unlimited number, so we will let j represent this possible outcome.

  • refers to the expected monetary value of decision alternative, i. There may be many decisions possible. We will let 1 stand for the first decision, 2 for the second, and so on. The lower- case letter i represents the entire set of decisions.

Explanation

Question 8 of 25

1

A method to analyze a decision regarding which property to buy is to determine the profit that might be lost because the state of nature (the market behaviour) was not known at the time the land developer bought the land.

Select one of the following:

  • opportunity loss or regret

  • opportunity gains

  • best decision method

  • opportunity decision regret

Explanation

Question 9 of 25

1

An opportunity loss table can be developed by taking:

Select one of the following:

  • The difference between the optimal decision and any other decision made.

  • The difference between the opportunity loss and the optimal decision made.

  • The difference between the opportunity loss and any other decision made

  • The difference between the optimal and the least optimal decisions.

Explanation

Question 10 of 25

1

EOL(Ai)

Select one of the following:

  • refers to the expected opportunity loss for a particular decision alternative.

  • refers to the probability associated with the states of nature, j.

  • refers to the regret or loss for a particular combination of a state of nature and a decision alternative.

Explanation

Question 11 of 25

1

P(Sj)

Select one of the following:

  • refers to the expected opportunity loss for a particular decision alternative.

  • refers to the probability associated with the states of nature, j.

  • refers to the regret or loss for a particular combination of a state of nature and a decision alternative.

Explanation

Question 12 of 25

1

R(Ai, Sj)

Select one of the following:

  • refers to the expected opportunity loss for a particular decision alternative.

  • refers to the probability associated with the states of nature, j.

  • refers to the regret or loss for a particular combination of a state of nature and a decision alternative.

Explanation

Question 13 of 25

1

The lowest expected opportunity loss and highest expected payoff will...

Select one of the following:

  • Always lead to the same decision concerning which course of action to follow.

  • Always lead to the opposite decision concerning which course of action to follow.

  • Usually lead to a similar decision concerning which course of action to follow.

  • Always lead to a different decision concerning which course of action to follow.

Explanation

Question 14 of 25

1

maximin strategy

Select one of the following:

  • The strategy that maximizes the minimum gain

  • The strategy that maximizes the maximum gain

  • The strategy that minimizes the maximum regret

Explanation

Question 15 of 25

1

maximax strategy

Select one of the following:

  • The strategy that maximizes the minimum gain

  • The strategy that maximizes the maximum gain

  • The strategy that minimizes the maximum regret

Explanation

Question 16 of 25

1

minimax regret strategy

Select one of the following:

  • The strategy that maximizes the minimum gain

  • The strategy that maximizes the maximum gain

  • The strategy that minimizes the maximum regret

Explanation

Question 17 of 25

1

Value of perfect information is

Select one of the following:

  • The difference between the maximum payoff under conditions of certainty and the maximum payoff under uncertainty.

  • The difference between the minimum payoff under conditions of uncertainty and the minimum payoff under certainty.

  • Very valuable information

  • Statistical data with a zero degree of error.

Explanation

Question 18 of 25

1

Sensitivity analysis

Select one of the following:

  • lets you see how accurate the probability estimates must be to feel comfortable with
    your choice.

  • Analysis how sensitive the data is to inclimate weather or acts of god.

  • Is the first step in the decision process.

  • Compares objections being voiced with history of experiences.

Explanation

Question 19 of 25

1

Decision trees

Select one of the following:

  • Present a picture of the various courses of action and the possible states of nature.

  • Are long term plans to continually make the best decisions over time.

  • Is a method of growing the accuracy of a choice with more data.

  • Is an alphabetical list of all decisions options.

Explanation

Question 20 of 25

1

backward induction

Select one of the following:

  • Is a strategy to find the best decision in a decision tree.

  • Is a common mistake made by statisticians.

  • Is a decision tree constructed backwards.

  • Is the process of making a decision and verifying it afterwards.

Explanation

Question 21 of 25

1

The various courses of action are called

Select one of the following:

  • The acts or alternatives

  • The decisions

  • The probabilities

  • The Consequences

Explanation

Question 22 of 25

1

The uncontrollable future events are called

Select one of the following:

  • The acts or alternatives

  • The decisions

  • The states of Nature

  • The payoff table

Explanation

Question 23 of 25

1

The consequence of a particular decision alternative and state of nature is called

Select one of the following:

  • The payoff

  • The states of nature

  • The Probabilities

  • The acts or alternatives

Explanation

Question 24 of 25

1

Probabilities are usually assigned to

Select one of the following:

  • The states of nature

  • The acts or alternatives

  • The payoff

  • The decision

Explanation

Question 25 of 25

1

All possible combinations of decision alternatives and states of nature result in

Select one of the following:

  • A payoff table

  • The states of nature

  • The acts or alternatives

  • The probabilities

Explanation

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