$B\&B$ has a new baby powder ready to market. If the firm goes directly to market with the product, there is only a 55 percent chance of success. However, the firm can conduct customer segment research, which will take a year and cost $$\$ 1.2$$ million immediately. By going through research, B\&B will be able to better target potential customers and will increase the probability of success to 70 percent. If successful, the baby powder will bring a PV profit (at time of initial selling) of $$\$ 19$$ million. If unsuccessful, the PV payoff is only $$\$ 6$$ million. Should the firm conduct customer segment research or go directly to market? The appropriate discount rate is 15 percent.