solved: This question needs a decision tree with something like TreePlan…

  

This question needs a decision tree with something like TreePlan…This question needs a decision tree with something like TreePlan from Excel. Monster Studios is a small movie production studio specializing in horror flicks. Historically, the movies they have produced either do quite well (are “hits”) or quite poorly (are “flops”). They earn an average of $40 million from their hit movies, and lose an average of $15 million on their flops. Of all movies produced in recent years, 40% have been hits and 60% have been flops. At a cost of C dollars, a market research firm can be hired to analyze a movie script, conduct market surveys, and make a prediction of how the movie will do if it is produced. If they issue a positive report, it is likely the movie would be a hit, while if they issue a negative report, it is likely the movie would be a flop. However, the report is not always accurate. The market research firm has the following track record on thirty similar previous movie scripts that they have analyzed: Image transcription textMovie is a Hit Movie is a Flop Market Research Issues Positive Report 9 6 Market Research Issues NegativeReport 3 12… Show morea. Suppose C = $3 million. Monster Studios has been presented with a new movie script entitled Zombie Professors that they feel is typical of other movies they have produced in recent years. In spreadsheet tab 4abc, build and solve a decision tree, and identify the strategy that maximizes their expected profit in responding to Zombie Professors. Should they hire the market research firm to issue a report on Zombie Professors? Should they produce the movie? (If they decide not to produce the movie, assume there are no additional revenues or costs, other than the cost of the market research firm if they were used.) Below the tree, include a sentence or two to fully describe the optimal strategy and the overall expected payoff. Clearly label this sentence as your answer to part a. b. What is the maximum value of C that Monster Studios should be willing to pay to hire the market research firm to assess Zombie Professors? Below the tree and your answer to part a, include a sentence to answer this question, and clearly label it as your answer to part b. (If you modify the data in the decision tree to help you answer this question, please return the tree to its original form to answer part a.) c. Suppose the market research firm from part a and b is no longer an option. To get an idea of what acquiring more information might be worth to Monster Studios, they want to determine the value of perfect information. Suppose there existed a “perfectly accurate” market research firm that always could correctly predict whether a script would be a hit or not. How much should Monster Studios be willing to pay to hire this perfectly accurate market research firm to assess Zombie Professors? Below the tree and your answer to parts a and b, include a sentence to answer this question, and clearly label it as your answer to part c. (If you modify the data in the decision tree to help you answer this question, please return the tree to its original form to answer part a.) d. Now suppose Monster Studios is risk averse and wishes to take this into account when making the decision presented in part a (still assuming C = $3 million). Suppose further than Monster Studios would just barely be willing to accept a hypothetical 50-50 gamble that would net $50 million if it succeeds but lose $25 million if it fails. Using TreePlan and the exponential utility function to account for Monster Studios aversion to risk, re-solve the decision tree in a new spreadsheet tab. In a sentence or two below the tree, fully describe the optimal strategy. MathStatistics and Probability QMETH 501

Don't use plagiarized sources. Get Your Custom Essay on
solved: This question needs a decision tree with something like TreePlan…
Just from $10/Page
Order Essay
Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
colle writers

Order your essay today and save 30% with the discount code ESSAYSHELP