Heading: Analyzing Risky Decisions

question 46

Multiple Choice

Heading: Analyzing Risky Decisions
**Reference: Use the decision tree along with the given probabilities to answer the next six questions
Probability Event A = 30% Probability Event B = 70%
Probability Event 1 = 58% Probability Event 2 = 42%
Probability of Event A given that Event 1 occurs = 16%
Probability of Event B given that Event 1 occurs = 84%
Probability of Event A given that Event 2 occurs = 50%
Probability of Event B given that Event 2 occurs = 50%

-*If the decision maker chooses Decision B, which decision alternative should the decision maker choose at node C?

• A)Decision 1
• B)Decision 2
• C)Either decision; they both have the same expected value.
• D)Neither decision; more information is needed.

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