I've asked about how to complete a decision tree based on the following information. I received the below response but my calculations are not matching when I complete them.

The EV for the new drug line is .71*4341*.63 + .29*1205*.63 = 2068.5 units. my calculation = 2161.88

The EV for the existing drug line is .63*5475*.48 + .37*1807*.48 = 2646.8 units. my calculation = 1976.56

The EV for making no changes is .81*730*.84 + .19*241*.84 = 598.4 units my calculation = 535.15

please explain where those responses are coming from. i've also included the previous explanation.

Question:

MPC contracted with Drug Markets Analysts Inc. (DMA). Based on competitive research, DMA has found that there are new competing drugs recently granted FDA approval. MPC will need to be aware of the competition in the market as they consider whether to:

develop a new drug line

exploit the existing drug line for potential new applications

continue with the current drug line at this time

The new formula is a clear advancement developed under strict guidelines and is scheduled for FDA approval in the first quarter of the year. Currently, there are only two other widely available products on the market that meet the same needs.

In a highly favorable market

a new drug line with have 71% likelihood of success with a demand of 4341 units per month,

the existing drug will have a 63% likelihood with a demand of 5475 units per month

and making no changes will be 81% likely to succeed with a demand of 730 units per month.

In an unfavorable market

a new drug line will have a demand of 1205 units per month

the existing drug will have a demand of 1807 units per month

and making no changes will have a demand of 241 units per month.

Profits are estimated to be

0.63 per unit for the new drug line

0.48 per unit for the existing drug line with new FDA-approved uses

while the current profit is 0.84 per unit.

PREVIOUS ANSWER FROM :

The EV for the new drug line is .71*4341*.63 + .29*1205*.63 = 2068.5 units.

The EV for the existing drug line is .63*5475*.48 + .37*1807*.48 = 2646.8 units.

The EV for making no changes is .81*730*.84 + .19*241*.84 = 598.4 units.

Explanation:

The expected value is the sum of the probability of each outcome multiplied by the value of that outcome. So, for the new drug line, the expected value is .71*4341 + .29*1205 = 2068.5 units. This means that if the new drug line is developed, there is a 71% chance that 4341 units will be demanded and a 29% chance that 1205 units will be demanded. Similarly, for the existing drug line, the expected value is .63*5475 + .37*1807 = 2646.8 units. This means that if the existing drug line is exploited for potential new applications, there is a 63% chance that 5475 units will be demanded and a 37% chance that 1807 units will be demanded. Finally, for making no changes, the expected value is .81*730 + .19*241 = 598.4 units. This means that if no changes are made, there is an 81% chance that 730 units will be demanded and a 19% chance that 241 units will be demanded.

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The expected value for the new drug line is .71*4341*.63 + .29*1205*.63 = 2068.5 units.

The expected value for the existing drug line is .63*5475*.48 + .37*1807*.48 = 2646.8 units.

The expected value for making no changes is .81*730*.84 + .19*241*.84 = 598.4 units. This means that the new drug line has the highest expected value, and so it would be the best option to pursue.