A group of medical professionals is considering the construction of a private clinic. If the medical demand

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A group of medical professionals is considering the construction of a private clinic. If the medical demand is high (i.e., there is a favorable market for the clinic), the physicians could realize a net profit of $100,000. If the market is not favorable, they could lose $40,000. Of course, they don't have to proceed at all, in which case there is no cost. In the absence of any market data, the best the physicians can guess is that there is a 50-50 chance the clinic will be successful. Construct a decision tree to help analyze this problem. What should the medical professionals do?

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Quantitative Analysis for Management

ISBN: 978-0132149112

11th Edition

Authors: Barry render, Ralph m. stair, Michael e. Hanna

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