Karen Villagomez, president of Wright Industries, is considering whether to build a manufacturing plant in the Ozarks. Her decision is summarized in the following table:

(a) Construct a decision tree.
(b) Determine the best strategy using expected monetary value (EMV).
(c) What is the expected value of perfect information(EVPI)?

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Favorable Market $400,000 S 80,000 Unfavorable Market $300,000 10,000 Alternatives Build large plant Build small plant Don't build Market probabilities 0.4 0.6