The manager of Paul's fruit and vegetable store is considering the purchase of a new seedless watermelon from a wholesale distributor. Because this seedless watermelon costs $4,will sell for $7,and is highly perishable,he expects only to sell between six and nine of them. Based on a maximax strategy,what alternative is selected?
A)Order 6
B)Order 7
C)Order 8
D)Order 9

Question

Quizplus · Accepted Answer

A maximax strategy involves selecting the alternative with the highest possible payoff. In this case, ordering 9 seedless watermelons would result in the highest potential profit of $27 (selling them all for $7 each). Therefore, ordering 9 is the best choice according to a maximax strategy.

The Manager of Paul's Fruit and Vegetable Store Is Considering