Universidad Nacional Abierta y a Distancia

Vicerrectoría Académica y de Investigación

Syllabus of the Course Theory of Decisions, Code 212066

Task 3 - Solving problems of optimization models under

uncertainties

1. Description of the activity

Activity type: In group - Collaborative

Time of assessment: Intermediate
Maximum activity score: 100 points
The activity starts on: Wednesday, Activity ends on: Tuesday, November 3,
October 7, 2020 2020
This activity is expected to achieve the following learning outcomes:

Propose solution models through hierarchical analytical processes and game theory
associated with production and service problems.

Apply solution methods in decision problems using hierarchical analytical processes

and game theory to search for optimal results that generate the most efficient
answers.

Evaluate problem outcomes using analytical hierarchical processes and game theory
for decision making on production and service process problems.

The activity consists of:

In the Learning environment, consult the bibliographic reference of unit 2.

optimization models under uncertainties:

• Sharma, J. (2016). Operations Research: Theory and Applications. (pp. 341-

391), New Delhi: Laxmi Publications Pvt Ltd, v. Sixth edition.

• Kelly, A. (2003). Decision Making Using Game Theory (pp. 28-51): An

Introduction for Managers: Cambridge, UK: Cambridge University Press
Editorial.

In the Exercises From 1 to 3, the student must solve the proponed cuestiones by
Criteria of Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage to determine
the final eficiencia in the decision process. Take into account the nature of the

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problems according to the proposed costs or utilities and with these data apply the
algorithms to analyze the efficiency of the problem.

Exercise 1. Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage

criteria (Profit Matrix):

In the company ABC several alternatives are presented to choose the best technology
of four possible, whose performance depends on the adaptation of the workers who
will manipulate the equipments that comprise it. The expected benefits of each
alternative and degree of adaptation of the workers are given in the table, in millions
of pesos ($).

Event
Does not Fits Fits Fits very
Alternative Fits well
fit acceptably successfully well
Technology 1 530 585 615 650 710
Technology 2 670 525 575 580 690
Technology 3 750 650 615 623 710
Technology 4 670 590 610 650 730
Technology 5 550 610 710 550 625
Table 1. Profit matrix

According to Table by applying the criteria of:

• Laplace.
• Wald or pessimistic.
• Optimistic criteria.
• Hurwicz and Savage
• Determine the optimal decision level according to the benefit criteria.

Exercise 2. Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage

criteria (Cost Matrix):

Fabcom, a company that manufactures electronic components for the introduction in

its product catalog, must decide whether to manufacture a new product in its main
plant, subcontract it with company supervision or if it buys it from an external
supplier. The profits depend on the demand of the product. The table shows projected
costs, in millions of dollars.

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 Event
Does not Fits Fits Fits very
Alternative Fits well
fit acceptably successfully well
Technology 1 415 435 510 575 610
Technology 2 318 535 575 603 621
Technology 3 650 575 556 456 611
Technology 4 540 718 560 459 532
Technology 5 497 535 435 415 560
Table 2. Cost matrix

According to Table by applying the criteria of:

• Laplace.
• Wald or pessimistic.
• Optimistic criteria.
• Hurwicz and Savage
• Determine the optimal decision level according to the cost criteria.

Exercise 3. Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage

criteria (Cost Matrix):

Fabricater company that has a productive experience in the foreign market of 20

years, must decide if it manufactures a new product in its main plant, or if on the
contrary the purchase from an external supplier. The profits depend on the demand
of the product. The table shows projected costs, in millions of dollars.
Event
Does not Fits Fits Fits very
Alternative Fits well
fit acceptably successfully well
Technology 1 519 585 615 650 710
Technology 2 457 525 560 580 687
Technology 3 560 650 605 623 710
Technology 4 670 574 600 650 730
Technology 5 542 610 710 550 625
Table 3. Cost matrix

According to Table by applying the criteria of:

• Laplace.
• Wald or pessimistic.
• Optimistic criteria.
• Hurwicz and Savage
• Determine the optimal decision level according to the cost criteria.
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Exercise 4. Game Theory method:

In exercise 4 you must find the game strategy of the players so that through game
theory a fair game is carried out according to the objective of the method, one player
wins as much as the other loses and vice versa. Proceed to use the corresponding
method according to the nature of the exercise proposed and answer the questions.

Graphical solutions are only applicable to games in which at least one of the players
has only two strategies. Consider the following 2 x n game:

Player 2
Strategy
A B C
Player I 24 17 13
1 II 29 7 33
Table 4. Theory of games 2 x n

According to Table 4:

• Find the value of the game by means of the graphical method applied to
matrices 2 x n or m x 2.

Exercise 5. Game Theory method:

Graphical solutions are only applicable to games in which at least one of the players
has only two strategies. Consider the following game m x 2:
Player 2
Strategy
A B
I 24 17
Player 1 II 29 7
II 19 11
Table 5. Game Theory m x 2

According to Table 5:

According to Table 5, find the value of the game by means of the graphical method
applied to matrices 2 x n or m x 2.

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Exercise 6. Optimum solution of two-person games:

The games represent the latest case of lack of information where intelligent
opponents are working in a conflicting environment. The result is that a very
conservative criterion is generally proposed to solve sets of two people and sum zero,
called minimax - maximin criterion. To determine a fair game, the minimax =
maximin, it is necessary to solve the stable strategy through the Solver.

66 73 47 58

35 65 51 27

76 64 52 69

48 77 65 38

Table 6. Mixed strategies

• Solve the game of players A and B to determine the value of the game, using
the proposed Excel tool, according to the data in table 6.

• Using Excel, formulate the solution with Solver and analyze the saddle point of
the given situation.

• Find the probabilities of the game and determine the saddle point of the given
situation.

From the problem situation:

Exercises 1, 2 and 3:

1. Identify the problem situation and the characteristics of the system, evaluating
whether it refers to costs or profits to apply each of the solution methods.

2. Calculate the best option and identify the method that provides the best cost
or benefit according to the nature of the problem.

In a spreadsheet Excel sheet, formulate each one of the proposed methods for
decision-making according to the conditions of the problem, analyze the solution and
alternatives to give a conclusion according to the productive system that you refer.

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Exercises 4 and 5:

1. Identify the values of P and Q according to each player, row or column to graph
the possible solutions.

2. Identify the lines with the largest positive and negative slopes to find the
solution intersection.

3. Find the probability that according to the method of randomized strategies

they give each player a fair game, where the value that one wins the other
loses and lives.

4. Show in an Excel sheet the graph that allows you to view the results found and
your solution analysis.

5. In Excel QM, find the solution to the linear programming problem.

Interpret the results of the expected value solution for decision making according to
the conditions of the problem. Individually, to present in the Discussion Forum
(Learning environment) the advances in the formulation, development, solution,
checking of results and interpretation of results of the problems in spreadsheet
(Excel) and Excel QM.

Exercise 6:

1. Solve the game of players A and B to determine the value of the game, using
the proposed Excel tool.

2. Using Excel, formulate the solution with Solver and analyze the saddle point of
the given situation.

3. Find the probabilities of the game and determine the saddle point of the given
situation.

4. In Excel QM, find the solution to the linear programming problem.

Interpret the results of the value solution for decision making according to the
conditions of the problem. Individually, to present in the Discussion Forum (Learning
environment) the advances in the formulation, development, solution, checking of
results and interpretation of results of the problems in spreadsheet (Excel) and Excel
QM.

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Collaboratively, the working group must select Exercise 4, Exercise 5 and Exercise
6, among those presented individually, to review and verify the procedure and
application of the mathematical models and algorithms required for the formulation,
development, solution, verification and interpretation of results to make the
respective adjustments and finally, proceed to the construction of the report in
spreadsheet (Excel) in the Discussion Forum (Learning environment) and deliver it
collaboratively in the Evaluation environment.

For the development of the activity, keep in mind that:

In the Learning environment, you should: Consult and review the agenda of the
course, consult the reference proposed in the required educational resources of Unit
2. Decision models under uncertainties, present in the forum of the activity, the
contributions and progress on development and solving the problems raised above.

In the Evaluation environment, you must: Deliver the report individually according
to its specifications and availability scheduled in the Course Agenda.

Individual evidence:

The individual evidences to deliver are:

Documents in spreadsheet (Excel) with the development of:

Exercises 1, 2 and 3. Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage

criteria:

1. Formulation of the problem as a model of Laplace, Wald or pessimistic,

optimistic, Hurwicz and Savage criteria.
2. Solution of the model and formulation Laplace, Wald or pessimistic, optimistic,
Hurwicz and Savage criteria according to the conditions of each problem in
spreadsheet (Excel) and Excel QM.
3. Interpretation of results of the model solution for decision making.

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Exercises 4 and 5. Game Theory method:

1. Formulation of the problem as a model of Game Theory method.

2. Solution of the model and formulation Game Theory method. according to the
conditions of each problem in spreadsheet (Excel) and Excel QM.
3. Interpretation of results of the model solution for decision making.

Exercise 6. Game Theory method:

1. Formulation of the problem as a model of Mixed strategies.

2. Solution of the model and formulation Mixed strategies method according to
the conditions of each problem in spreadsheet (Excel) and Excel QM.
3. Interpretation of results of the model solution for decision making.

Group evidence:

The group evidences to deliver are:

Document in spreadsheet (Excel) titled Solving problems of decision models under

uncertainties, which must contain the following information and presentation: Cover.
Identifying the activity, the title, the authors, the tutor, the course, the institution,
the school, the program and the year.
Content:

Exercises 4, 5 or 6. Game theory:

1. Formulation of the problem.

2. Solution of the model in spreadsheet (Excel) and Excel QM.
3. Interpretation of results of the model solution and decision making.

Bibliography (with APA standard).

File Extension: xls or pdf

Identification: Task 3. Name of the student.

2. General guidelines for the preparation of the evidence to be

delivered.

For individually produced evidence, consider the following guidelines:

1. You must present the progress of the activity in the forum of the activity during
the time allocated for the activity.

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 2. Before delivering the requested product, you must check that it meets all the
requirements indicated in this activity guide.

Please note that all individual or group written products must comply with the
spelling standards and the defined presentation conditions. Regarding the use of
references, consider that the product of this activity must comply with APA
standards. In any case, comply with the reference standards and avoid academic
plagiarism, for this you can support yourself by reviewing your written products using
the Turnitin tool found on the virtual campus.

Consider that in agreement 029 of December 13, 2013, article 99, the following are
considered as offenses that violate the academic order, among others: literal e)
“Plagiarism, that is, presenting as your own authorship the all or part of a work,
work, document or invention made by another person. It also implies the use of
missing citations or references, or proposing citations where there is no coincidence
between it and the reference ”and liberal f)“ Reproducing, or copying for profit,
educational materials or results of research products, which have intellectual rights
reserved for the University ”

The academic sanctions that the student will face are the following:
a) In cases of academic fraud demonstrated in the academic work or respective
evaluation, the grade to be imposed will be zero points without prejudice to the
corresponding disciplinary sanction.
b) In cases related to plagiarism demonstrated in academic work, whatever its
nature, the grade to be imposed will be zero points, without prejudice to the
corresponding disciplinary sanction.

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 3. Evaluation Rubric Format

Activity type: In group - Collaborative

Time of assessment: Intermediate
The maximum possible score is 100 points
High level: The student develops and presents all the
First evaluation activities proposed in the forum of the activity .
criterion: If your work is at this level you can get between 14
points and 15 points
Use the forum of the
activity to develop Medium Level: The student develops and presents some
and present Task 3. activities proposed in the forum of the activity .
If your work is at this level you can get between 2
This criterion points and 13 points
represents 15
points out of the Low level: The student does not develop and present the
total 100 points of activities proposed in the forum of the activity .
the activity. If your work is at this level you can get between 0
points and 1 points
Second evaluation
High level: The student correctly analyzes the methods
criterion:
of Laplace, Wald or pessimistic, optimistic, Hurwicz and
Savage criteria to find the efficiency of the problem 1,
Use the methods of
correctly determining all the requested aspects.
Laplace, Wald or
If your work is at this level you can get between 9
pessimistic,
points and 10 points
optimistic, Hurwicz
and Savage criteria
Medium Level: The student partially analyzes the
to find the efficiency
methods of Laplace, Wald or pessimistic, optimistic,
of the problem 1
Hurwicz and Savage criteria to find the efficiency of the
according to its
problem 1, partially determining the requested aspects.
nature to make
If your work is at this level you can get between 2
decisions in a process
points and 8 points
of production and
services.
Low level: The student does not apply the methods of
Laplace, Wald or pessimistic, optimistic, Hurwicz and
This criterion
Savage criteria to find the efficiency of the problem 1 in
represents 10
the development and solution.
points out of the
If your work is at this level you can get between 0
total 100 points of
points and 1 points
the activity.

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Third evaluation High level: The student correctly analyzes the methods of
criterion: Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage
criteria to find the efficiency of the problem 2, correctly
Use the methods of determining all the requested aspects.
Laplace, Wald or If your work is at this level you can get between 9
pessimistic, optimistic, points and 10 points
Hurwicz and Savage
criteria to find the Medium Level: The student partially analyzes the methods
efficiency of the of Laplace, Wald or pessimistic, optimistic, Hurwicz and
problem 2 according to Savage criteria to find the efficiency of the problem 2,
its nature to make partially determining the requested aspects.
decisions in a process If your work is at this level you can get between 2
of production and points and 8 points
services.
Low level: The student does not apply the methods of
This criterion Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage
represents 10 criteria to find the efficiency of the problem 2 in the
points out of the development and solution.
total 100 points of If your work is at this level you can get between 0
the activity. points and 1 points
Fourth evaluation High level: The student correctly analyzes the methods of
criterion: Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage
criteria to find the efficiency of the problem 3, correctly
Use the methods of determining all the requested aspects.
Laplace, Wald or If your work is at this level you can get between 9
pessimistic, optimistic, points and 10 points
Hurwicz and Savage
criteria to find the Medium Level: The student partially analyzes the methods
efficiency of the of Laplace, Wald or pessimistic, optimistic, Hurwicz and
problem 3 according to Savage criteria to find the efficiency of the problem 3,
its nature to make partially determining the requested aspects.
decisions in a process If your work is at this level you can get between 2
of production and points and 8 points
services.
Low level: The student does not apply the methods of
This criterion Laplace, Wald or pessimistic, optimistic, Hurwicz and Savage
represents 10 criteria to find the efficiency of the problem 3 in the
points out of the development and solution.
total 100 points of If your work is at this level you can get between 0
the activity. points and 1 points

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 High level: The student correctly analyzes methods of Game
Fifth evaluation theory to find a fair game of players row and column
criterion: according to its nature, correctly determining all the
requested aspects.
Use the methods of If your work is at this level you can get between 14
Game theory points and 15 points
to find a fair game of
players row and Medium Level: The student partially analyzes the methods
column according to of Game theory to find a fair game of players row and column
its nature. according to its nature, partially determining the requested
aspects.
This criterion If your work is at this level you can get between 2
represents 15 points and 13 points
points out of the
total 100 points of Low level: The student does not apply methods of Game
the activity. theory to find a fair game of players row and column
according to its nature in the development and solution.
If your work is at this level you can get between 0
points and 1 points
High level: The student correctly analyzes methods of Game
Sixth evaluation theory to find a fair game of players row and column
criterion: according to its nature, correctly determining all the
requested aspects.
Use the methods of If your work is at this level you can get between 14
Game theory points and 15 points
to find a fair game of
players row and Medium Level: The student partially analyzes the methods
column according to of Game theory to find a fair game of players row and column
its nature. according to its nature, partially determining the requested
aspects.
This criterion If your work is at this level you can get between 2
represents 15 points and 13 points
points out of the
total 100 points of Low level: The student does not apply methods of Game
the activity. theory to find a fair game of players row and column
according to its nature in the development and solution.
If your work is at this level you can get between 0
points and 1 points

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 High level: The student correctly analyzes randomized
strategies method to find the saddle point and the
Seventh evaluation probabilities of success of the two players, correctly
criterion: determining all the requested aspects.
If your work is at this level you can get between 14
Use the randomized points and 15 points
strategies method to
find the saddle point Medium Level: The student partially analyzes randomized
and the probabilities of strategies method to find the saddle point and the
success of the two probabilities of success of the two players, partially
players. determining the requested aspects.
If your work is at this level you can get between 2
This criterion points and 13 points
represents 15
points out of the Low level: The student does not apply randomized
total 100 points of strategies method to find the saddle point and the
the activity. probabilities of success of the two players according to its
nature in the development and solution.
If your work is at this level you can get between 0
points and 1 points
High level: The student presents the report with the
development and correct solution of the problems posed,
with excellent writing, spelling, citations and bibliographic
references in accordance with the APA standard in its
Eighth evaluation content.
criterion: If your work is at this level you can get between 9
points and 10 points
Report Solution of
Decision methods and Medium Level: The student presents the report with the
game theory. development and partial solution of the problems posed, with
writing, spelling, citations and / or bibliographic references in
This criterion accordance with the APA standard in its content.
represents 10 If your work is at this level you can get between 2
points out of the points and 8 points
total 100 points of
the activity. Low level: The student does not present the report with the
development and solution of the problems posed.
If your work is at this level you can get between 0
points and 1 points

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