You have a rare vinyl record. The record label that made the vinyl record is about to announce which old records will be reissued. You must decide whether to auction your vinyl now, or wait to see if it will or will not be reissued.

If you auction it off, you estimate there is a 25% chance you will net $250, and a 75% chance you will net $650.

If you keep it and wait for the announcement, you estimate there is a 60% chance the vinyl will be reissued and yours will drop in value to net $100. But, there is a 40% chance it will not be reissued, in which case the value of your record will increase to net $1200.

As an expected value maximizer, you make the optimal decision to auction your record. You expect to net $550.

Genie Analytics offers to provide perfect information to you. How much are you willing to pay? That is, what is EVPI? - The answer is 260, but how did we get that?