You are trying to decide between taking a Finance class or an Accounting class next semester.
You are trying to decide between taking a Finance class or an Accounting class next semester. In Finance, you believe that you have a 10% chance of receiving an A, 30% chance for a B, 40% chance for a C and 20% chance for a D. In Accounting, you have a 60% chance for a B, 25% chance for a C, 10% chance for a D and 5% chance for a F. You are indifferent between following situations.
1) Receive A with probability 0.8 or F with probability 0.2. Receive B with probability 1.
2) Receive A with probability 0.5 or F with probability 0.5. Receive C with probability 1.
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines
Order Paper Now3) Receive A with probability 0.1 or F with probability 0.9. Receive D with probability 1.
a) Find the utility of each grade using the indifference probability method. (Hint: U(A)=1, U(F)=0)
b) Draw the decision tree describing the problem at hand, using the utilities as values for getting each grade c) What is the decision that you should make
Hi i am confused with the indifference part? how i am supposed to calculate the U(B) and U(C)? and help with the question??