flow occurs 11. Rework Problem , assuming that the demand can be high, medium, and low with proba bilities . 7, 2, and .1, respectively. Expansion of a small plant will occur only if demand the first 2 years is high. The following table gives the annual income. Ignore the time value of money. Estimated annual income (in $1000) Alternative High demand Medium demand Low demand Full-sized plant now Small-sized plant now Expanded plant in 2 years 1000 400 900 500 280 600 300 150 200 9. TriStar plans to open a new plant in Arkansas. The company can open a full-sized plant now or a small-sized plant that can be expanded 2 years later if high demand conditions prevail. The time horizon for the decision problem is 10 years. TriStar estimates that the probabilities for high and low demands over the next 10 years is.75 and 25, respectively The cost of immediate construction of a large plant is $5 million, and a small plant costs $1 million. Expansion of a small plant 2 years from now costs $4.2 million. The income Decision Analysis a 504 Chapter 13 from the operation over the next 10 years is given in the following table: Estimated annual income (in $1000) Low demand High demand Alternative 300 1000 250 900 Full-sized plant now Small-sized plant now Expanded plant in 2 years 200 200 (a) Develop the associated decision tree, given that after 2 years TriStar has the options to expand or not expand the small plant. (b) Develop a construction strategy for TriStar over the next 10 years. (For simplicity, ignore the time value of money.) Rain 100 and that the danisie