Biology Forums - Study Force

Science-Related Homework Help Statistics and Probability Topic started by: shchandan on Dec 30, 2021



Title: Use the information below to answer the following question(s). Hats-R-Us would like to produce a new ...
Post by: shchandan on Dec 30, 2021
Use the information below to answer the following question(s).

Hats-R-Us would like to produce a new design of hats for the upcoming Major league Baseball World Series. They need to decide to produce a large quantity or small quantity of hats prior to the event starting. Eventual demand for this new design will be strong or weak with a 50/50 chance of each level occurring. The following table shows the payoff for each combination of production size and demand level, in thousands of dollars.



Hats-R-Us also has the option of conducting a market survey at a cost of $10,000 to acquire more accurate information about the likelihood of each demand level. If the survey results are positive, there is an 83% probability that the eventual demand for the new hat design will be strong. If the survey results are negative, there is a 23% probability that the eventual demand for the new hat design will be strong.

Construct a decision tree to answer the following set of questions.

The expected value without sample information, in thousands of dollars is _________.

▸ $212.3

▸ $240.0

▸ $288.6

▸ $296.4


Title: Use the information below to answer the following question(s). Hats-R-Us would like to produce a new ...
Post by: afahad on Dec 30, 2021
Content hidden