Question 2: Case Study, The Sourcing Decision at Forever Young, Chapter 6. The paragraph with the title Uncertainties Faced by Forever Young is slightly changed for your assignment and is given below: Uncertainties Faced by Forever Young To better compare the two suppliers, management identifies demand and exchange rates as the two major uncertainties faced by the company. Over each of the next two periods (assume them to be a year each), demand may go up by 10% with a probability of 0.4, stay as the previous period demand with a probability of 0.2, or go down by 10% with a probability of 0.4. Demand in the current period is 1000 units. Similarly, over each of the next two periods, the yuan may strengthen by 5% with a probability of 0.5 or weaken by 5% with a probability of 0.5. The exchange rate in the current period was 6.5 yuan. Forever Young is considering the following three options: (i) Purchase from the current Chinese supplier (ii) Purchase from the local supplier

Answer the following question: a. Draw Decision Tree for the case

b. Evaluate expected profit for each of the ab