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The Alternatives 1 and 2 in the Following Payoff Table

question 69

Multiple Choice

The 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 (S₁) represent the levels of demand for the company products.S₁,S₂ and S₃ characterize high,medium and low demand with probabilities of .3,.6 and .1 respectively.The payoff values are in thousands of dollars. The management believes that the weather conditions significantly affect the level of demand.48 monthly sales reports are randomly selected.These monthly sales reports showed 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.The management believes that the weather conditions significantly impact the level of demand and the estimated probabilities of poor weather conditions given different levels of demand is presented below. What is the probability of high demand given that the weather conditions are poor?

Definitions:

Indians in the Northeast

Indigenous peoples living in the northeastern part of North America, known for their rich cultures, languages, and traditions, and for forming vital societies long before European colonization.

European Colonization

The process by which European countries established control over territories across the world, starting in the late 15th century.

Adaptation

The process of changing or modifying something to better suit a new environment or purpose, often used in biological and cultural contexts.

English Colonization

The process of English settlement and establishment of control over regions in the Americas, Africa, and Australasia from the 16th to the 18th centuries.