The Decision Rule Under the Maximin Criterion Is To

question 12

Multiple Choice

The decision rule under the maximin criterion is to:

• A)Select the alternative that has the best outcome should the worst event occur.
• B)Select the alternative that has the best average outcome.
• C)Select the alternative that has the best outcome should the best event occur.
• D)Select the alternative that has the best chance of maximising the return.

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Definitions:

Mean

The arithmetic average of a set of numbers, calculated by adding them together and dividing by the number of quantities.

Point Estimate

A single value estimate of a population parameter that serves as the best guess or prediction of the parameter.

Confidence Limits

Confidence limits define the range within which a population parameter is estimated to lie with a certain level of confidence.

Standard Error

A measure of the dispersion or spread of sample means around the population mean.