Question
Using the following information, determine your choice between Action C (certain) or Action G (gamble) based on expected monetary value. (6 Marks) Action C (certain): receive Rs.50 for sure. Action G (gamble): 80% chance of Rs.100 and 20% chance of complete loss.
Answer :
Word Count : 1014
_______ _________ _____ ______ _______ ____ ________ _____ ___.
________ ______ ______ _________ __________ ___ _________ _________ _____.
_______ _______ _________ __________ _______ ______ _____ _________ _________ ____ ________ ____.
___ ________ __________ _________ __________ ______ ___ ___ ________ ____ _________ ___.
___ ___ ______ _______ _______ _________ _________ ___ ____ ________.
_______ _____ __________ ___ __________ _________ ________ __________.
___ ___ ___ _________ _____ __________ __________ _________ _____ _____ ______.
______ ______ ________ ______ ___ ___ _______ __________ ________ ____ ______.
_____ ________ _____ ______ _______.
____ ________ _______ ________ ______ _____ ______ _______.
__________ ______ _________ ___ ___ ___ ____ ___ _________ _______ ____.
______ ______ _____ ____ ____ _____ ____ _____ ______ ___ _____.
_____ _______ ___ _______ _____ _____ ________ ____ _______ ___.
_____ ____ ___ _____ ___ __________ ________ _________ ___ ___ _________.
________ _______ ___ __________ __________ ____ __________ ______ ___ ___ ________.
_________ __________ ______ ________ __________ ___ __________ _____.
_____ ________ ____ ____ ________.
_______ ______ ____ ______ _______ ________ ______.
__________ _________ ________ _________ ________ ___ __________ __________ ________ ______.
________ ______ _________ ______ _____ ____ ______ _______ ____ _________ _________.
___ ____ _______ _____ ___.
____ ___ ___ _______ __________ ______ _________ ____ ____ _______ ___.
____ ______ __________ _____ ____ _________ _________ __________ _________ ________ __________.
__________ ____ __________ ______ _____ __________ ___ ____ _______ _______ _______ ______.
_______ __________ ___ ____ ____.
___ ________ ____ ______ _______ _____ _______.
__________ __________ ________ __________ __________ __________ _________ _____ ______ _____ _________ ________.
_______ _______ __________ _____ __________ ________ _____ _________ _______ __________ _______ __________.
____ ___ ___ _____ ___ ____ ___ _______ ______ _______ __________ ____.
_____ ____ ________ ________ _____ __________ _____ ____ ______ ______ _________ ____.
______ __________ ___ _________ _____ _________ ________ ____ _____ _____ __________ _________.
__________ ______ _________ _________ ______ _____ ______.
______ _______ ______ ____ _________ ______.
____ _________ ___ _______ ________ _______ ______ _______ ______ _____.
_________ _____ _________ _______ ______ ______ _______ ____ ____ ___ ___ ___.
_________ _________ _____ ________ ______ ____ _______ _______ ______.
____ ______ ________ _____ ________ ____ _____ ____ _________.
_________ __________ _______ ____ _________ ______ ________ _____ _____ ___ ___ _______.
______ ____ _______ ____ _______ ____ ____ ________ _______.
__________ __________ _________ __________ ________ ____ _________ _________ ___ _______ ______ ___.
______ _______ ________ _____ _________ _____ _____ _________ ______ ____ ________.
__________ __________ _________ ____ __________ ___ __________ _____ __________ ___ ____.
____ _______ ____ ________ _______ ___ ________ _________ __________ __________.
______ _________ __________ ___ _________.
_______ ____ ___ ______ ____ ______.
__________ ____ ______ __________ _____ _________ ___ ____ _______.
___ _____ ______ __________ __________ _______ ______ ______ _________ _________.
___ _____ ______ ______ ___ _______ ___ _______ _____ _____ ___.
___ ________ ___ __________ _________ ___ ________ _________ _________.
____ _________ __________ _____ ____ _______ __________ _________.
_______ ________ ___ _______ ____ _________ _____ _______ ______.
_____ ____ _______ __________ __________ ____ _______ _____ ___ _____.
_____ __________ ________ _______ ________.
___ _________ _________ _____ ____ _____ _______ _________ ____ __________.
_____ ___ ____ _______ __________.
_______ ____ ________ _________ _________ ____ ______.
___ ________ __________ ____ _________ ________ _______.
__________ _______ ____ _________ _____.
_______ _____ _____ _______ _________ _____.
_______ ___ ____ _____ _______ ___ __________.
__________ ____ ________ ___ _________ __________ _________ ___ ________ __________ ___ ______.
______ _________ ______ _________ _____ ________ _____ _______ ______ _______ ___.
________ ___ _________ ____ _______ _________ ___ ___ _______ _____ ______ _________.
__________ _______ ________ __________ _________ _______ ________ ________ _____ ______ ________.
________ ________ _________ _________ _____ ________ ________ _________ _______ ______ _______.
____ _________ ________.
Skip in 10
Expected Monetary Value (EMV) is a decision-making technique used to compare different alternatives under conditions of uncertainty. It calculates the average expected financial outcome of each possible action by multiplying every possible outcome by its probability and then adding the results. In programming and AI, expected monetary value can be used as a simple decision-making model where an intelligent system evaluates available actions and selects the one with the better expected result. In the given problem, there are two alternatives: Action C, which is a certain option, and Action G, which is a gamble. Action C provides a guaranteed amount of Rs.50, while Action G provides either Rs.100 or Rs.0 depending on the outcome. The objective is to determine which action should be selected based on expected monetary value. For Action C, the amount received is Rs.50 with certainty. Since the probability of receiving Rs.50 is 100%, or 1.0, its expected monetary value can be calculated as: EMV(Action C) = Probability × Payoff EMV(Action C) = 1.0 × Rs.50 EMV(Action C) = Rs.50 Therefore, the expected monetary value of Action C is Rs.50. For Action G, there are two possible outcomes. The first outcome is receiving Rs.100, which has an 80% probability. The second outcome is receiving Rs.0, representing a complete loss, which has a 20% probability. The expected monetary value is calculated by multiplying each payoff by its corresponding probability and adding the results. EMV(Action G) = (Probability of Rs.100 × Rs.100) + (Probability of Rs.0 × Rs.0) EMV(Action G) = (0.80 × Rs.100) + (0.20 × Rs.0) EMV(Action G) = Rs.80 + Rs.0 EMV(Action G) = Rs.80 Thus, the expected monetary value of Action G is Rs.80. The two alternatives can therefore be compared as follows: Action C: EMV = Rs.50 Action G: EMV = Rs.80 Since Rs.80 is greater than Rs.50, Action G has the higher expected monetary value. The difference between the two expected values is: Rs.80 − Rs.50 = Rs.30 Therefore, based strictly on the expected monetary value criterion, Action G should be selected. Although Action G involves uncertainty and carries a 20% probability of receiving nothing, its higher potential reward and 80% probability of receiving Rs.100 make its average expected return Rs.80, which is Rs.30 more than the guaranteed Rs.50 offered by Action C. This type of calculation demonstrates how a decision-making system can handle uncertainty mathematically. In programming,
___ _____ _______ ________ __________ _________ ____ __________ _______ ______ _______._______ _________ _____ ______ _______ ____ ________ _____ ___.
________ ______ ______ _________ __________ ___ _________ _________ _____.
_______ _______ _________ __________ _______ ______ _____ _________ _________ ____ ________ ____.
___ ________ __________ _________ __________ ______ ___ ___ ________ ____ _________ ___.
___ ___ ______ _______ _______ _________ _________ ___ ____ ________.
_______ _____ __________ ___ __________ _________ ________ __________.
___ ___ ___ _________ _____ __________ __________ _________ _____ _____ ______.
______ ______ ________ ______ ___ ___ _______ __________ ________ ____ ______.
_____ ________ _____ ______ _______.
____ ________ _______ ________ ______ _____ ______ _______.
__________ ______ _________ ___ ___ ___ ____ ___ _________ _______ ____.
______ ______ _____ ____ ____ _____ ____ _____ ______ ___ _____.
_____ _______ ___ _______ _____ _____ ________ ____ _______ ___.
_____ ____ ___ _____ ___ __________ ________ _________ ___ ___ _________.
________ _______ ___ __________ __________ ____ __________ ______ ___ ___ ________.
_________ __________ ______ ________ __________ ___ __________ _____.
_____ ________ ____ ____ ________.
_______ ______ ____ ______ _______ ________ ______.
__________ _________ ________ _________ ________ ___ __________ __________ ________ ______.
________ ______ _________ ______ _____ ____ ______ _______ ____ _________ _________.
___ ____ _______ _____ ___.
____ ___ ___ _______ __________ ______ _________ ____ ____ _______ ___.
____ ______ __________ _____ ____ _________ _________ __________ _________ ________ __________.
__________ ____ __________ ______ _____ __________ ___ ____ _______ _______ _______ ______.
_______ __________ ___ ____ ____.
___ ________ ____ ______ _______ _____ _______.
__________ __________ ________ __________ __________ __________ _________ _____ ______ _____ _________ ________.
_______ _______ __________ _____ __________ ________ _____ _________ _______ __________ _______ __________.
____ ___ ___ _____ ___ ____ ___ _______ ______ _______ __________ ____.
_____ ____ ________ ________ _____ __________ _____ ____ ______ ______ _________ ____.
______ __________ ___ _________ _____ _________ ________ ____ _____ _____ __________ _________.
__________ ______ _________ _________ ______ _____ ______.
______ _______ ______ ____ _________ ______.
____ _________ ___ _______ ________ _______ ______ _______ ______ _____.
_________ _____ _________ _______ ______ ______ _______ ____ ____ ___ ___ ___.
_________ _________ _____ ________ ______ ____ _______ _______ ______.
____ ______ ________ _____ ________ ____ _____ ____ _________.
_________ __________ _______ ____ _________ ______ ________ _____ _____ ___ ___ _______.
______ ____ _______ ____ _______ ____ ____ ________ _______.
__________ __________ _________ __________ ________ ____ _________ _________ ___ _______ ______ ___.
______ _______ ________ _____ _________ _____ _____ _________ ______ ____ ________.
__________ __________ _________ ____ __________ ___ __________ _____ __________ ___ ____.
____ _______ ____ ________ _______ ___ ________ _________ __________ __________.
______ _________ __________ ___ _________.
_______ ____ ___ ______ ____ ______.
__________ ____ ______ __________ _____ _________ ___ ____ _______.
___ _____ ______ __________ __________ _______ ______ ______ _________ _________.
___ _____ ______ ______ ___ _______ ___ _______ _____ _____ ___.
___ ________ ___ __________ _________ ___ ________ _________ _________.
____ _________ __________ _____ ____ _______ __________ _________.
_______ ________ ___ _______ ____ _________ _____ _______ ______.
_____ ____ _______ __________ __________ ____ _______ _____ ___ _____.
_____ __________ ________ _______ ________.
___ _________ _________ _____ ____ _____ _______ _________ ____ __________.
_____ ___ ____ _______ __________.
_______ ____ ________ _________ _________ ____ ______.
___ ________ __________ ____ _________ ________ _______.
__________ _______ ____ _________ _____.
_______ _____ _____ _______ _________ _____.
_______ ___ ____ _____ _______ ___ __________.
__________ ____ ________ ___ _________ __________ _________ ___ ________ __________ ___ ______.
______ _________ ______ _________ _____ ________ _____ _______ ______ _______ ___.
________ ___ _________ ____ _______ _________ ___ ___ _______ _____ ______ _________.
__________ _______ ________ __________ _________ _______ ________ ________ _____ ______ ________.
________ ________ _________ _________ _____ ________ ________ _________ _______ ______ _______.
____ _________ ________.
IGNOU ACADEMY
Your IGNOU journey, made easier.
- Solved Assignments
- Study Notes
- Guess Papers
- Question Papers
Continue Reading — It's Free
Sign in with Google to unlock more of this answer.
✓ Free access
✓ Unlock up to 60% of the answer
✓ No payment required
✓ Unlock up to 60% of the answer
✓ No payment required
Quick Google sign-in. No separate registration form.