For each scenario, you will construct decision tree, as indicated in the problem. You should use the influence diagrams presented in the solutions below to create your decision tree.

Problem 2 Using fire in forest management sounds contradictory. Prescribed fire, however, is an important tool for foresters, and a recent article describes how decision analysis is used to decide when, where and what to burn. In one example, a number of areas in the Tahoe National Forest in California had been logged and were being prepared for replanting. Preparation included prescribed burning, and two possible treatments were available: burning the slash as it lay on the ground, or yarding of unmerchantable material (YUM) prior to burning. The latter treatment involves using heavy equipment to pile the slash. YUM reduces the difficulty of controlling the burn but costs an additional $100 per acre. In deciding between the two treatments, two uncertainties were considered critical. The first was how the fire would behave under each scenario. For example, the fire could be fully successful, problems could arise which could be controlled eventually, or the fire could escape, entailing considerable losses. Second, if problems developed, they could result in high, low, or medium costs. Develop a decision tree for this situation. Note that you will not have exact dollar values as consequences so you can use high, medium, and low as needed.

Solution to Problem 2 are attached. Use the solutions to create decision trees for this problem.

Problem 2: Vijay's objectives include: maximizing profit minimizing inappropriate/poor behavior of people when they get drunk minimizing legal costs maximizing Rising Moon's appeal. Vijay's decision is to apply for a liquor license, and if granted, then he could decide on how to manage drinking at Rising Moon. For example, he might be able to create a separate area of his place, such as a beer garden, where drinking alcohol is allowed. Vijay could also decide to broaden his menu in other ways than serving alcohol. The uncertainties include: future sales and profit for Rising Moon market reaction to offering alcohol amount of disruption occurring from serving alcohol legal liabilities. Consequence measures for sales, profit, and legal costs are clear. He could simply count the number of disruptions to the business due to alcohol or he could try to associate a cost figure to the disruptive behavior. Rising Moon's appeal could be measured by the change in sales volume due to introducing alcohol. Vijay will certainly, as law likely requires, hedge by carrying insurance, and he will want to think carefully about the level of insurance. As mentioned, he might be able to have a designated area for drinking alcohol. He could gather information now via surveys or speaking to other local merchants. Lastly, he can always change his mind later and stop serving alcohol