Which of the Following Is a Drawback of the Maximin

question 24

Multiple Choice

Which of the following is a drawback of the maximin criterion?

• A)It ignores the payoffs associated with the "high demand" state of nature.
• B)It ignores the payoffs associated with the "low demand" state of nature.
• C)It is not a good method to use when the states of nature are not equally probable.
• D)It ignores the maximum payoff that could be realized if the decision maker were a risk taker.

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Definitions:

Decimals

Numerical digits that represent fractions of ten, used to express numbers less than one or to provide precision in numerical representations.

Mixed/Whole Numbers

Numbers consisting of an integer and a fractional part, typically represented as a whole number and a proper fraction.

Percents

A mathematical representation of a fraction of 100, used to describe proportions or rates.

Decimals

Numbers expressed using a decimal system, involving a point to separate the whole number from the fractional part.