In a Decision Tree, the Difference Between a Decision Node

question 153

Multiple Choice

In a decision tree, the difference between a decision node and a terminal node is that

• A)at a decision node all participants are free to make individual decisions but at a terminal node they must agree on a collective decision.
• B)at a decision node all participants make the same decision, while at a terminal node different players may make different decisions.
• C)at a decision node a decision must be made, while a terminal node shows the payoff.
• D)at a decision node a decision must be made, while at a terminal node the final decision must be made.

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Definitions:

Political Risk

The risk of losing money due to changes in a country's political environment or policy.

Foreign Operations

Business activities and transactions conducted in countries other than the company's home country.

Parent Company

A corporation that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors.

Forward Trade

A tailor-made agreement for buying or selling an asset at a future moment, based on a price established in the present, and not conforming to standard regulations.