Given a payoff table in a decision making under risk scenario, what value is derived from applying the following decision rule?
Apply all four criteria presented in your book and choose the alternative that is selected more frequently than the others.
The decision rules include maximin, maximax, Laplace, and minimax regret. Maximin chooses the "best of the worst" and is for the pessimist. Maximax chooses the "best of the best" and is for the optimist. Laplace chooses the best weighted payoff and is for the realist. Minimax regret chooses the best "worst regret." Applying an overall winner to the four criteria might permit the decision maker to satisfy the appetite for risk of the greatest number of stakeholders. The mindsets that drive a decision maker towards one criterion or another are such that an average of these approaches most probably will hold no additional cachet for any single optimist or pessimist or centrist.
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