The Quality Control Manager for ENTA Inc -What Is the Maximum Amount That You Would Be Willing

question 1

Essay

The quality control manager for ENTA Inc. must decide whether to accept (A1), further analyze (A2), or reject (A3) a lot of incoming material. Assume the following payoff table is available. Historical data indicates that there is 30% chance that the lot is poor quality (S1), 50 % chance that the lot is fair quality (S2), and 20% chance that the lot is good quality (S3).
$$\begin{array} { l r r r } & \mathbf { S } _ { \mathbf { 1 } } & \mathbf { S } _ { \mathbf { 2 } } & \mathbf { S } _ { \mathbf { 3 } } \\\mathbf { A } _ { \mathbf { 1 } } & 20 & 30 & 90 \\\mathbf { A } _ { \mathbf { 2 } } & 60 & 70 & 10 \\\mathbf { A } _ { \mathbf { 3 } } & 80 & 50 & 40\end{array}$$
-What is the maximum amount that you would be willing to pay for perfect information?

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Definitions:

Open Delta

A transformer connection method using two transformers to form a delta configuration, typically used when one transformer of a three-phase system is out of service or for economy in a lightly loaded system.

Single-Phase Loads

Equipment that operates on a single alternating current (AC) power phase, usually seen in residential and light commercial settings.

High Leg

In electrical systems, a conductor within a delta configuration that carries higher voltage to ground than the other conductors.

Center Tapped Transformer

A transformer with a connection point (tap) in the middle of the secondary winding, which allows for splitting the output voltage into two parts, each half of the full voltage.