A payoff table given as If the probabilities of d1 d2 and d3

A payoff table given as If the probabilities of d1, d2, and d3, are .3 .4, and .3, respectively, then what choice should be made under expected value?

Solution

Expected value for d1 = 0.3(250) + (0.4) * (450) + (0.3) (500) = 405

Expected value for d2 = 0.3(300) + 0.4* (-250) + 0.3 * (700) = 200

Expected value for d3 = 0.3(400) + 0.4* (500) + 0.3 * (800) = 560

Depending on the expected values, it would be good to take decision 3.