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ACCA PM风险：Decision-making criteria
文章来源：ACCA全球官网
发布时间：2021-09-03 17:30
阅读：1177次
Coefficient of variation and standard error
The coefficient of variation is calculated simply by dividing the standard deviation by the expected return(or mean):
Coefficient of variation=standard deviation/expected return
For example,assume that investment X has an expected return of 20%and a standard deviation of 15%,whereas investment Y has an expected return of 25%and a standard deviation of 20%.The coefficients of variation for the two investments will be:
Investment X=15%/20%=0.75
Investment Y=20%/25%=0.80
The interpretation of these results would be that investment X is less risky,on the basis of its lower coefficient of variation.A final statistic relating to dispersion is the standard error,which is a measure most often confused with standard deviation.Standard deviation is a measure of variability of a sample,used as an estimate of the variability of the population from which the sample was drawn.When we calculate the sample mean,we are usually interested not in the mean of this particular sample,but in the mean of the population from which the sample comes.The sample mean will vary from sample to sample and the way this variation occurs is described by the‘sampling distribution’of the mean.We can estimate how much a sample mean will vary from the standard deviation of the sampling distribution.This is called the standard error(SE)of the estimate of the mean.
The standard error of the sample mean depends on both the standard deviation and the sample size:
SE=SD/√(sample size)
The standard error decreases as the sample size increases,because the extent of chance variation is reduced.However,a fourfold increase in sample size is necessary to reduce the standard error by 50%,due to the square root of the sample size being used.By contrast,standard deviation tends not to change as the sample size increases.
Decision-making criteria
The decision outcome resulting from the same information may vary from manager to manager as a result of their individual attitude to risk.We generally distinguish between individuals who are risk averse(dislike risk)and individuals who are risk seeking(content with risk).Similarly,the appropriate decision-making criteria used to make decisions are often determined by the individual’s attitude to risk.
To illustrate this,we shall discuss and illustrate the following criteria:
Maximin
Maximax
Minimax regret【点击免费下载>>>更多ACCA学习相关资料】
An ice cream seller,when deciding how much ice cream to order(a small,medium,or large order),takes into consideration the weather forecast(cold,warm,or hot).There are nine possible combinations of order size and weather,and the payoffs for each are shown in Table 4.
The highest payoffs for each order size occur when the order size is most appropriate for the weather,i.e.small order/cold weather,medium order/warm weather,large order/hot weather.Otherwise,profits are lost from either unsold ice cream or lost potential sales.We shall consider the decisions the ice cream seller has to make using each of the decision criteria previously noted(note the absence of probabilities regarding the weather outcomes).
1.Maximin
This criteria is based upon a risk-averse(cautious)approach and bases the order decision upon maximising the minimum payoff.The ice cream seller will therefore decide upon a medium order,as the lowest payoff is£200,whereas the lowest payoffs for the small and large orders are£150 and$100 respectively.
2.Maximax
This criteria is based upon a risk-seeking(optimistic)approach and bases the order decision upon maximising the maximum payoff.The ice cream seller will therefore decide upon a large order,as the highest payoff is$750,whereas the highest payoffs for the small and medium orders are$250 and$500 respectively.
3.Minimax regret
This approach attempts to minimise the regret from making the wrong decision and is based upon first identifying the optimal decision for each of the weather outcomes.If the weather is cold,then the small order yields the highest payoff,and the regret from the medium and large orders is$50 and$150 respectively.The same calculations are then performed for warm and hot weather and a table of regrets constructed(Table 5).
The decision is then made on the basis of the lowest regret,which in this case is the large order with the maximum regret of$200,as opposed to$600 and$450 for the small and medium orders.
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