question 18: decision tree Flashcards
1
Q
explain why option a might not be the best option
A
It is high risk and has a 20% chance where option b is low risk and has 60% success rate and 40% failure.
Option a has higher initial cost adding more to the risk than option b
Option a has net gain of 3m but 80% chance of failure and option b has net gain of 2.4 m but has 40% chance of failure.
