Qnt 561 Week 1: Planning A Vacation

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Decision of Uncertainty Paper Milan C. Kelly QNT 561 December 17, 2012 Sripathi Nilkar When planning a vacation, there are many different factors to consider. Destination and cost are two of the major factors that will influence the decision of when to go on vacation. These factors also impact the type of experience that a traveler will have when deciding on a vacation. With time and financial obligations to consider, I have decided to take a Caribbean cruise vacation during hurricane season. Now that reservations have been made for this trip, I am forced to consider whether or not purchasing insurance for an additional fee is the best option. Research has been conducted to determine this important decision. The calculated probabilities of a hurricane taking place during my scheduled cruise and whether or not the cruise will be canceled due to the hurricane are included in this research. The research shows that there is a 5% probability that the cruise will be canceled due to a hurricane (University of Phoenix, n.d.). On the contrary, this data would also mean that there is a 95% chance that the cruise will take place as scheduled (University of Phoenix, n.d).…show more content…
Further research shows that during this time of hurricane season, there is a 90% possibility that the cruise will be canceled. Bayes’ Theorem has been applied to determine the confidence intervals to forecast the occurrence of a hurricane, the captain’s hurricane cancellation policy, and purchasing hurricane insurance. The data listed in the scenario will help me in deciding to purchase hurricane insurance or to take a risk and go on the trip as planned. To make an informed decision, more research has to be conducted and applied to this circumstance. The research has been used to decide to purchase hurricane insurance as well as a supplemental traveler’s

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