The director of social services of a county has learned that the state has manda
ID: 438412 • Letter: T
Question
The director of social services of a county has learned that the state has mandated additional information requirements. This will place an additional burden on the agency. The director has identified three acceptable alternatives to handle the increased workload. One alternative is to reassign present staff members, the second is to hire and train two new workers, and the third is to redesign current practice so that workers can readily collect the information with little additional effort. An unknown factor is the caseload for the coming year when the new data will be collected on a trial basis. The estimated costs for various options and caseloads are shown in the following table:-------------------------- Case Load-------------------
---------------------Moderate-----High-----Very High
Reassign staff-----$50------------$60-------$85
New Staff-----------$60-----------$60------$60
Redesign Collection-$40----------$50-------$90
*Cost in $ thousands.
Assuming that past experience has shown the probabilities of various caseloads to be unreliable, what decision would be appropriate using each of the following criteria?
a. Maximin.
b. Maximax.
c. Minimax regret.
d. Laplace.
Explanation / Answer
a. Maximin.