For problem 15 63 suppose that the chief executive officer may
For problem 15-63, suppose that the chief executive officer may hire a consulting firm for a fee of $725,000. The consulting firm will advise the CEO about the possibility of success of the merger. This consulting firm is known to have correctly predicted the outcomes of 89% of all successful mergers and the outcomes of 97% of all unsuccessful ones. What is the optimal decision?
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