bUESTION 6 Expected value Applied to Business Application (20 points) 25 minutes on slide A Manufacturing Company must make a decision regarding the level of sales aid dedication to a new product. There are 2 possible decisions to be evaluated. The potential profit from each decision alternative depends on the market acceptance which may be high, moderate or low. If market acceptance is high, each of the two decision alternatives, dl and d2, will yield a profit of 310 and 280 thousand dollars respectively. If the demand turns out to be moderate, then the profits will be 120 and 90 thousand dollars respectively. If the demand turns out to be low, then the profits will be -70 and -10 thousand dollars respectively. The prior probability estimates of demand to be high, moderate and low are 0.45, 0.35 and 0.2 respectively. The company first needs to decide whether to hire an expert to provide more accurate information regarding the future demand levels or not. Graph the decision tree and state the decision strategy using the following probabilities: P(F) = 0.75 P(low F) = 0.1 P(low I U) = 0.5 P(High) = 0.45 P(moderate I F) = 0.2 P(moderate U) = 0.4 P(moderate) = 0.35 P(U) = 0.25 P(High I F) = 0.7 P(High I U) = 0.1 P(Low) = 0.2 Which of the decision alternatives should be selected by the company? Calculate and interpret the expected profit from the best decision alternative.