1. Draw a decision tree to depict the scenario described below. (3 points)

Upon moving into her new apartment, a renter is considering whether to carry renter insurance. She estimates that the

replace value of her belongings is $20,000.

Local crime statistics indicate that there is a probability of 3% that her apartment will be broken into in the coming

year. In that event her losses would be $2,000 or $8,000 of the contents with probabilities 50% and 15% respectively.

An insurance policy from company A costs $150 a year but guarantees to replace any losses due to theft. That is, zero

deductible.

An insurance policy from company B is cheaper at $100 a year but the renter has to pay the first $500 of any loss

herself. An insurance policy from company C is even cheaper at $75 a year but carries a high deductible of $1000.

2. Describe an event you encountered during this week that required you to analyze or make a decision. After you have

described it, convert the description into a decision tree. In a unique path, the path from the root node to a leaf node,

your decision tree should have at least two child nodes. (2 points)

3. For this question, you are to select one of the options below and complete the work:

a. Apply conditional or nested conditional logic to convert the following grading scale, from the course syllabus,

into an Excel worksheet. You are to submit an Excel file for grading. (5 points)

Percentage Range Grade Percentage Range Grade Percentage Range Grade

93% X A 80% X < 83% B- 70% X < 73% C-

90% X < 93% A- 77% X < 80% C+ 60% X < 70% D

87% X < 90% B+ 73% X < 77% C X < 60% F

83% X < 87% B

b. If you select this option, you are to complete both tasks below.