Question

4. (5 pts) Acme Outdoors Co. is introducing a new line of sport all-terrain vehicles (ATVs). Acme is considering marketing
program proposals from two competing companies: A & B. A's marketing plan is expected to generate high sales with a 75%
probability and only a 25% likelihood of low sales.
An alternative marketing plan from company B could result in an initial 60% likelihood of high ATV sales and 40% probability
of low sales. But company B's offer also contains a provision for an optional follow-on promotion if a low response is returned.
If an optional follow-on ATV promotion is conducted by company B, there is a 70% chance of ultimately realizing high sales.
Draw an appropriate decision tree diagram with branches labeled and probabilities assigned. Do not solve!

Answer 1

Answer:

Given organization having two choices of taking advertising plan.

i.e.,

From A to B

On the off chance that showcasing plan of An is chosen, there is the odds of getting high deals is 75% and 25% vocation for low deals.

On the off chance that promoting plan of B is chosen, there are odds of getting high ATV deals is 60%& 40% of low deals.

Given the worth returned is lower by the advertising plan proposed by B , then another arrangement ought to followed which has 70% of high scores.

So there is an opportunity of 30% possibility of low deals.

The given outline says the various options for given organization and odds of high deals and low deals.

In the given fig. shows that on the off chance that the B get low deals by first arrangement, at that point we have another arrangement proposed by B i.e., 70% benefit and 30% low deals.

So the likelihood of picking An and B separately are given then we can compute the estimations of anticipated comes back from the taken decisions.

Henceforth, choice can be found from the given outline.

So it is called as choice tree.

Figure is given below