Business
Business, 15.06.2021 07:00, savyblue1724707

Dong-A Publishing House recently received a manuscript for a university textbook called ‘Business Science’ from an author. The editors of this publishing house have been publishing textbooks for a long time, and they judge that there is a 65% chance that the requested textbooks will be successful when they are published. If successful, the publisher is estimated to generate a profit of 75 million won. However, he is concerned that if the book is published and the textbooks are not successfully sold, a loss of 25 million won may occur. Therefore, this editor is considering requesting a review from an expert who is familiar with this field before contracting the manuscript. Review results are received in two cases: Favorable (F) or Unfavorable (U). Based on past experience, at this level of manuscript level, the review results are considered to be P(F)=0.7, P(U)=0.3. When the case where the sale of the textbook is successful is s1, and the case where it is not is s2 It is estimated that P(s1|F)=0.75, P(s1|U)=0.42, P(s2|F)=0.25, and P(s2|U)=0.58. (1) Write a decision tree to review and publish the received manuscript. (2) What is the optimal decision-making strategy? (3) What is the expected value of perfect information? (4) If the review cost of the plaintiff was 5 million won, what kind of decision would be made?

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