Based on the Following Payoff Table, Answer the Following The Bayes' Decision Rule Strategy Is:
A) Small

question 62

Multiple Choice

Based on the following payoff table, answer the following:
$$\begin{array} { | l | r | r | } \hline { \text { Alternative } } & { \text { Yes } } & { \text { No } } \\\hline \text { Brmall } & 10 & 30 \\\hline \text { Medium } & 20 & 40 \\\hline \text { Mediurn Large } & 30 & 45 \\\hline \text { Large } & 40 & 35 \\\hline \text { Extra Large } & 60 & 20 \\\hline \text { Prior Probability } & 0.3 & 0.7 \\\hline\end{array}$$
The Bayes' decision rule strategy is:

• A) small.
• B) medium.
• C) medium large.
• D) large.
• E) extra large.

---

Definitions:

Reference Point

The point from which an individual makes a consumption decision.

Past Consumption

refers to the total amount of goods and services consumed in previous time periods, influencing current and future economic decisions.

Market Experience

The accumulation of knowledge, customer feedback, and operational insights that a company gains through its activities in a particular market.

Irrational Behavior

Actions or decisions that do not align with logical or expected outcomes, often contrasting with rational choice theory.