Question: The probabilities shown at nodes 4, 8 and 9 are based on the projected outcomes of the market research study. a. Verify Dantes profit projections

The probabilities shown at nodes 4, 8 and 9 are based on the projected outcomes of the market research study.

a. Verify Dante’s profit projections shown at the ending branches of the decision tree by calculating the payoffs of E2 650 000 and E650 000 for the first two outcomes.

b. What is the optimal decision strategy for Dante, and what is the expected profit for this project?

c. What would the cost of the market research study have to be before Dante would change its decision about the market research study?

d. Develop a risk profile for Dante.

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