Question: Check My Work B Spreadsheet eBook Techware Incorporated is considering the introduction of two new software products to the market. The company has four options

Check My Work B Spreadsheet eBook Techware
Check My Work B Spreadsheet eBook Techware
Check My Work B Spreadsheet eBook Techware Incorporated is considering the introduction of two new software products to the market. The company has four options regarding these products: introduce neither product, introduce product 1 only, introduce product 2 only, or introduce both products. Research and development costs for products 1 and 2 are $180,000 and $150,000, respectively. Note that the first option entails no costs because research and development efforts have not yet begun. The success of these software products depends on the national economy in the coming year. The company's revenues, depending on its decision and the state of the economy, are given in the file P09_33.xlsx. The probabilities of a strong, fair, or weak economy in the coming year are assessed to be 0.10, 0.60, and 0.30, respectively. a. Use Precision Tree to identify the strategy that maximizes Techware's expected net revenue. Techware's optimal decision is to introduce product 2 only By following this strategy, Techware can expect to earn $ in net revenue. b. Perform a sensitivity analysis on the optimal decision, letting each of the inputs vary one at a time plus or minus 25% from its base value, and summarize your findings. Which of the inputs appears to have the largest effect on the best solution? The R&D cost for both products ], and revenue for product introduction in the case of a fair national economy, have the largest effect on the best solution. Check My Work 0 Icon Key B C D E E F ntroduction of new products Decisions Introduce neither product Introduce Product 1 only Introduce Product 2 only Introduce both products Trend in national economy Strong Fair Weak $0 $0 $0 $500,000 $260,000 $120,000 $420,000 $230,000 $110,000 $820,000 $390,000 $200,000 Data eady

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