For what range of probability that demand will be high, will she decide to lease the medium facility?
A)0 - .25
B)0 - .33
C).25 - .5
D).33 - 1
E).5 - 1

Question

Quizplus · Accepted Answer

Based on the decision tree, if the probability of high demand is between .25 and .5, leasing the medium facility will result in a higher expected profit than leasing the small facility. If the probability of high demand is less than .25, leasing the small facility will yield the highest expected profit, and if the probability of high demand is greater than .5, the large facility will yield the highest expected profit.

For What Range of Probability That Demand Will Be High