00:01
For this question, there is given a tree here.
00:03
So we just define the square boxes are the decision points and the circles are the event nodes.
00:11
So let me just name these notes.
00:13
Let's say this is x, this is y, this is, oh, let me just say this is a.
00:19
So this is a, this is b, this is c, and this is d.
00:26
So first of all, we need to get the missing probabilities here.
00:29
So first of all, we have 0 .6 here.
00:34
So that means this is 0 .4.
00:36
And we have 0 .4, 0 .3.
00:39
And subtract from 1, that should be 0 .3 here.
00:42
And also we have 0 .6 here.
00:44
So subtract from 1, that should be 0 .4 for this case.
00:48
And is there any missing? no, there is no any missing here.
00:53
So first of all, let me just use the alternative one.
00:57
So for the alternative one, there are two pair of nodes.
01:05
So the first one is the node a.
01:07
So if i just use the note a, let me just write that as the note a.
01:13
So what about the expected value here? so we have 0 .6 times 20, right, and plus 0 .4 times 25.
01:25
This is 0 .6 times 20 and plus 0 .4 times 25.
01:34
So the expected value here, which is $22.
01:38
And what about the expected payoff note b? let me just write as the node b here.
01:44
If i just follow the note b here, there are three different cases.
01:49
I can just follow this way, this way or this way.
01:52
Let me just find the expected value here.
01:54
This is 0 .4 times 15 and plus 0 .3 times 18 and plus 0 .3 times 28 and plus 0 .3 times 28.
02:04
Let me get this is 0 .4 times 15 and plus 0 .3 times 18 and plus 0 .3 times 28.
02:15
So the expected value here which is 19 .8.
02:18
So when we just compare these two values because there is no any way for the alternative one...