Question

DECISION ANALYSIS

The Department of Health is in the process of choosing four hospitals that will act as COVID-19 facilities. Below are the costs the DOH will incur in selecting these hospitals.

Alternative	S1 = Emergency Use	S2 = Ward Use	S3 = ICU Use
Hospital A (HA)	50,000	35,000	90,000
Hospital B (HB)	35,000	45,000	55,000
Hospital C (HC)	45,000	25,000	60,000
Hospital D (HD)	60,000	45,000	80,000

It was found out that the probability of S1 is 45%, and the probability of S2 is 50%, what would be the decision (Use HA, HB, HC, or HD)________ of DOH and how much is the expected expenses__________ to the health agency if hospital A provides 20% discount, hospital B gives 15% discount, and hospital D offers a 25% discount. Hospital C does give discount because it is a government hospital

Answer 1

Probability	0.45	0.5	0.05
Alternative	S1 Emergrncy use	S2 ward use	S3 ICU use	Total	Discount	Final cost	Ranking
Hospital A	50000	35000	90000		20%
prob use	22500	15750	40500	78750	15750	63000	IV
Hospital B	35000	45000	55000		15%
prob use	15750	20250	24750	60750	9112.5	51637.5	I
Hospital C	45000	25000	60000		0
prob use	20250	11250	27000	58500	0	58500	II
Hospital D	60000	45000	80000		25%
prob use	27000	20250	36000	83250	20812.5	62437.5	III

As the cost is less of Hospital B is less, it should be selected by DOH