When using decision tree analysis:
A) the sum of the expected payoffs must always equal zero.
B) round nodes represent decision points.
C) there must be more square nodes than round nodes.
D) probabilities for all branches leaving a chance node must sum to 1.0.

Question

Quizplus · Accepted Answer

Probabilities for all branches leaving a chance node in a decision tree must sum to 1.0, reflecting the certainty that one of the possible outcomes will occur.

When Using Decision Tree Analysis