Question: Compute the expected payoffs for each alternative shown in the following decision tree. (Values in the tree are in millions. Use the same format, rounding


Compute the expected payoffs for each alternative shown in the following decision tree. (Values in the tree are in millions. Use the same format, rounding to 2 decimals, to enter your answers.) $1.0 $1,3 Do nothing Smal demand (4) Expand $1.3 Medium demand 1.5 Large demand (3) $1.5 Do nothing Expand $116 Bund 519 Subcontract $0. Do nothing Other use 1 $1,5 Other use #2 $1.0 Smal demand (4) Expand Medium demand (5) Large demand $15 Do nothing Subcontract $1.5 Buna $1. Build 3019 DO wothung Other use $1 Other use Small der Medium do 5) $1.0 510 Large demand Do nothing Owhere SU Care2 Net present value in millions 5214 0.56 EV subcontract Evexpand Frey 3 6 5 10 Next > pe here to search O 3) Net present value in millions ences EV subcontract EVexpand EVbuild Thus, has the highest expected payoff Expand Subcontract
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