Question: The ABC Company is using a legacy software. However, some influential stakeholders believe that by upgrading this software your company can save money, while others

The ABC Company is using a legacy software.

The ABC Company is using a legacy software. However, some influential stakeholders believe that by upgrading this software your company can save money, while others feel that staying with the legacy software is the safest option, even though it is not meeting the current company needs. The stakeholders supporting the upgrade of the software are further split into two factions: those that support buying the new software and those that support building the new software in-house. Each three scenario alternative will have either a positive and negative risk impact. The scenario options and risk assessments for these alternatives are given below. Based on this information; Scenario Options Code Alternative Investment Cost (1000TL) A Stay with the legacy software 400 Risk Assessment Income or Impact Probability Expense (1000TL) Positive 0,6 600 Negative 0,4 200 Positive 0,7 1600 Negative -400 Positive 0,5 2400 Negative 0,5 -800 Build the new software 800 0,3 Buy the new software 1200 a) (8 pts) Draw the decision tree, b) (10 pts) Find the expected monetary value (EMV) of each alternative. c) (2 pts) Which scenario alternative should be selected? Why

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