Exhibit 14.8 The Following Questions Use the Information Below

question 85

Multiple Choice

Exhibit 14.8
The following questions use the information below.
A company needs to buy a new insurance policy. They have three policies to choose from, A, B and C. The policies differ with respect to price, coverage and ease of billing. The company has developed the following AHP tables for price and summary. The other tables are not shown due to space limitations.
-The decision rule which determines the maximum payoff for each alternative and then selects the alternative associated with the largest payoff is the

• A) maximax decision rule.
• B) maximin decision rule.
• C) minimax regret decision rule.
• D) minimin decision rule.

---

Definitions:

Addition

Addition is the mathematical process of combining two or more quantities to find their total or sum.

Division

The arithmetic operation of dividing one quantity by another, resulting in a quotient and sometimes a remainder.

Multiplication

An arithmetic process that involves multiplying two numbers to achieve their resultant multiplication.

Evaluate

To determine or calculate the value of something.