Perform a sensitivity analysis on the probability of a great market. To do this, enter formulas in cells B9 and B10 (see Figure 6.4) to ensure that the probabilities of "fair" and "awful" remain in the same ratio, 35 to 20, and that all three probabilities continue to sum to 1. Then let the probability of "great" vary from 0.25 to 0.50 in increments of 0.05. Is it ever best to abandon the product in this range?

3 Decision 1: Continue development and market the new product 4 Fixed cost 5 Unit margin 18 7 Market 8 Great 9 Fair 10 Awful All monetary values (except the unit margin in cell B5) are in $1000s, and all sales volumes are in 1000s of units. Probabili 0.45 0.35 0.20 Sales volume 600 300 90 Net revenue 10,800 $5,400 $1,620 $1,074 13 14 Decision 2: Stop deve lopment and abandon product 15 No payoffs, no costs, no uncertainty $0