The Laplace method is a decision-making criterion used under conditions of uncertainty. It assumes that all outcomes are equally likely. To apply the Laplace method, you can calculate the average outcome for each decision alternative.
Here are the steps we'll follow:
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Calculate the average outcome for each alternative:
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Sell Company: \[ \text{Average} = \frac{150 + 150 + 130}{3} = \frac{430}{3} \approx 143.33 \]
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Form Joint Venture: \[ \text{Average} = \frac{320 + 270 + (-100)}{3} = \frac{490}{3} \approx 163.33 \]
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Sell Software on Own: \[ \text{Average} = \frac{513 + 400 + (-250)}{3} = \frac{663}{3} \approx 221.00 \]
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Compare the average outcomes:
- Sell Company: \(143.33\)
- Form Joint Venture: \(163.33\)
- Sell Software on Own: \(221.00\)
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Decision: Based on the average outcomes calculated, the decision alternative with the highest average is:
- Sell Software on Own \( \approx 221.00\)
Thus, using the Laplace method, the best decision alternative to choose is to Sell Software on Own.