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A manager must select one of three projects, W, X or Y.
The following payoff table has been prepared to show the outcomes in $000 at three possible levels of demand:
The manager is now preparing a regret matrix.
What figure (in $000) will be shown for Project Y in the regret matrix if the average demand arises?
Suggested Answer: A
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13 comments · newest first
CE
Cecil
2 months ago
I feel confident about A) 150. It seems like the right choice.
GI
Gilma
2 months ago
I agree with Jamie. Regret matrix shows missed opportunities.
KI
Kizzy
2 months ago
I think it's B) 110. Project Y has lower payoffs at average demand.
GE
Geoffrey
2 months ago
This question is tricky. I feel unsure about the regret matrix.
ET
Ethan
3 months ago
I don't know, I thought it would be higher than that.
AJ
Aja
3 months ago
Totally agree, 150 sounds right!
DU
Dudley
3 months ago
Wait, are we sure about that? Seems off to me.
PE
Pearlene
3 months ago
I think it's actually 150 for Project Y.
AS
Ashlyn
3 months ago
Project Y has a payoff of 110 at average demand.
GE
Georgeanna
3 months ago
I think I remember that the regret for Project Y at average demand could be 150, but I’m not confident. I need to double-check the payoffs again to be sure.
DA
Daniela
4 months ago
If I recall correctly, for average demand, we should look at the payoffs for all projects and find the maximum for that demand level. Then subtract Project Y's payoff from it.
AM
Amos
4 months ago
I’m not entirely sure how to calculate the regret matrix. I think it involves finding the difference between the best outcome and the outcome for Project Y, but I’m confused about the average demand level.
GA
Gayla
4 months ago
I remember we practiced a similar question with a payoff table and had to calculate regrets. I think the regret for Project Y might be related to the highest payoff in that demand scenario.