The disadvantage of the expected-value criterion is that it does not take into account the decision maker's attitude toward profit.

Question

Quizplus · Accepted Answer

The expected-value criterion primarily focuses on the average outcome of decisions, but it does not inherently account for the decision maker's attitude toward risk or profit. However, the disadvantage is more accurately that it does not consider the decision maker's risk preference, rather than their attitude toward profit specifically.

The Disadvantage of the Expected-Value Criterion Is That It Does