Solve the problem.A company has three different marketing strategies that produce different results depending upon whether inflation is above 6%, between 3% and 6% inclusive, or below 3% annually. Three different experts predict inflation for the next year, but cannot agree. Each predicts one of the three levels. The company's board of directors has three plans of action and will implement one of these. Since the situation has repeated itself for several years, they decided to use game theory to assign probabilities and use these probabilities in making their decision. What assignment of probabilities will maximize their expected value? The payoff matrix below is in hundreds of thousands of dollars.
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A. The company should use Plan 1 with probability 1, Plan 2 with probability 0, and Plan 3 with probability 0.
B. The company should use Plan 1 with probability 4/13, Plan 2 with probability 9/13, and Plan 3 with probability 0.
C. The company should use Plan 1 with probability 0, Plan 2 with probability 1, and Plan 3 with probability 0.
D. The company should use Plan 1 with probability 5/13, Plan 2 with probability 8/13, and Plan 3 with probability 0.
Answer: D
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?
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B. gram
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