Question: Please help me with this question. Thank you!!! South-East Builders {SEE} currently acquired a large piece of land in the Whitby residential area. Two projects

Please help me with this question. Thank you!!!

Please help me with this question. Thank you!!! South-East Builders {SEE} currently

South-East Builders {SEE} currently acquired a large piece of land in the Whitby residential area. Two projects are under consideration, they are highly dependent on the market demand. Market demand can be favorable (F), or unfavorable {Ll}. When market demand is favorable, Project-Alpha will generate a prot of '3? million while projectBeta generate only TB million prot. When market demand is unfavorable, projectBeta will generate a prot of 55 million while projectAlpha generate only 34 million. Furthermore, SEE believes the probability that market demand being favorable is sixty-ve percent and probability that market demand being unfavorable is thirtyve percent. SEE objective is maximizing the prot. a] Draw decision tree for the problem, solve it and what decision should the SEE! make? b] What will be the most amounts SEE should pay to a rm, if rm provides perfect information? Draw only the extended part of the tree. c} The company can buy a preconstnrction survey report which assesses future market conditions. The survey report classies the market condition as either Encouraging {E} or Discouraging {D}. When the survey classied market condition as discouraging, there is 69.45% chance that market demand will be unfavorable. In addition, survey report also classies that probability of favorable market demand and encouraging market condition is daddies. Furthermore, when market demand is unfavorable, there is TE'ii. chance that survey will classify market condition as discouraging. Draw the extended part of the decision tree of this problem and calculate expected value of the imperfect intormation. State the optimal strategy. If pre-construction survey cost eight hundred thousand then SEE should buy the pre- construction survey report or not? Justify your

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