TrustMe.Inc a software development corporation has determined that it needs to expand its current capacity. The decision has come down to whether to expand now with a large facility incurring additional costs and taking the risk that the demand will not materialize or to undertake a small expansion knowing that the decision will have to reconsidered in five years. Management has estimated the following chances for demand:

1. the likelihood of demand being high is 0.7
2. likelihood of demand being low is 0.3

Profits for each alternative have been estimated:

Large expansion has an estimated profitability of either $900,000 or $210,000, depending on whether demand turns out to be high or low.

Small expansion has a profitability of $450,000 assuming that demand is low.

Small expansion with an occurrence of high demand would require considering whether to expand further. If the company expands at that point, you can be 100% certain that the profitability is expected to be $820,000. If it does not expand further, you can be 100% certain that the profitability is expected to be $600,000. Provide the required expected value(s) for each of the decision branches in the space below and which option would you recommend? Decision tree is required only in the pdf file. Hand drawn decision trees are OK as long as it is legible.