QMB 3600 Lecture Notes - Lecture 9: South Texas High School For Health Professions, Dependent And Independent VariablesPremium
2 pages58 viewsFall 2018
DepartmentQuantitative Methods in Bus
Course CodeQMB 3600
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Optimistic (maxi-max): best possible outcome w/ best payoff. Pick biggest value in table.
Conservative (maxi-min)-guaranteed min possible payout. Pick biggest value in smallest column.
Mini max- must build regret table
Variable being predicted, the dependent variable, is the y
Variable being used to predict, the independent variable, is the x
Multiple R- coefficient of correlation: always b/t -1 and +1. Must check sign of slope to see if positive or negative.
What is min expect opp. Loss? -> EV of PI
to max. profits? <- EV w/o PI
Highest val you’d pay for reliable forecast?-> EV of PI
Max Expect payoff? -> EV w/o P
EV of PI= (EV w/PI)- (EV w/o PI)
EV w/PI=(highest val) x prob per situation w/best payoff
Efficiency of SI= (EV of SI/EV of PI) x 100
<- Take lowest regret
Dependent=yint + slope (independent variable)
Dependent=yint +slope(interest rate) +slope (ind. Variable)
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