Question: 2. Based on available information, a student develops a decision tree. Payoff (5 millions) (6) Large Market 5.0 Produce & Market (-4) Low Mkt -5.0

2. Based on available information, a student develops a decision tree. Payoff (5 millions) (6) Large Market 5.0 Produce & Market (-4) Low Mkt -5.0 Develop (6) Large Mkt Sell Idea 4.0 Product (4) Low Mkt -10 Lease for Royalty (16) Large Market 30 Sell Idea Company A (4) Low Mkt -10 (6) Large Market Company B 3.5 (4) Low Mkt. -15 0.7 a) Calculate expected value at every node including the first node. Show work. b) What is the optimum decision and its expected value? c) If your risk tolerance is -$1.0 million, what is the optimum decision and expected value

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