This payoff matrix gives potential dollar gain values in thousands for strategies S1, S2, S3, and S4 for Sam's Pizza and competitive strategies CA1, CA2, and CA3 for Pam's Pizza. What is the maximum regret value for S1?
CA1 CA2 CA3
S1 13 14 7
S2 7 17 12
S3 31 29 4
S4 20 12 21
A) 18
B) 15
C) 14
D) 12
Answer: A
Explanation: The regret value shows the maximum amount that Sam can lose by making the wrong choice. In this case, the difference between the CA1 value of 13 and the CA1 value of 31 gives the maximum regret of 18 for S1, meaning the most that could have been lost had Sam not chosen S1 would have been 18 thousand dollars.
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