Alternatives 1 and 2 in the Following Payoff Table Represent

question 9

Short Answer

Alternatives 1 and 2 in the following payoff table represent the two possible manufacturing strategies that the EKA manufacturing company can adopt. The level of demand affects the success of both strategies. The states of nature (S_I) represent the levels of demand for the company products. S₁, S₂, and S₃ characterize high, medium, and low demand, respectively. The payoff values are in thousands of dollars.
The management believes that weather conditions significantly affect the level of demand. 48 monthly sales reports are randomly selected. These monthly sales reports show 15 months with high demand, 28 months with medium demand, and 5 months with low demand. 12 of the 15 months with high demand had favorable weather conditions. 14 of the 28 months with medium demand had favorable weather conditions. Only 1 of the 5 months with low demand had favorable weather conditions.
If the weather conditions are poor, determine which manufacturing strategy the company should implement.

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Definitions:

Socioemotional Interactions

Exchanges between individuals that involve emotional support, social connection, and the expression of feelings.

Integrated TMS

Refers to a type of Transactive Memory System where group members integrate their knowledge and skills effectively, enhancing the collective memory and problem-solving capabilities of the team.

Differentiated TMS

Stands for Differentiated Transactive Memory Systems, which involve compartmentalized and specialized knowledge distribution within teams.

Free-riders

Individuals who benefit from the efforts and contributions of a group without offering equivalent participation or input.