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Risk and uncertainty in decision making

3.2 Decision rules: Minimax regret

Risk averse
and a sore

loser

Aim to minimise
the regret from
making a bad

decision

Minimax regret

Illustrations and further practice

Now read illustration 3 ‘The Maximax Rule’ and try example 2 ‘Product Fishy’
from Chapter 12. Also, read illustration 4 ‘The Maximin Rule’ and try example 3,
then read illustration 5 ‘Minimax regret’.

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