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15.18 Decision Tree A... ...I LTE CASE: QPOP MEGA EVENT The QPOP Mega Event will be held in Jakarta in March 2022, the event
15.18 Decision Tree A... ...I LTE CASE: QPOP MEGA EVENT The QPOP Mega Event will be held in Jakarta in March 2022, the event is expected to be attended by 100,000 people. For this event, the event organizer wants to sell exclusive merchandise. However, the organizers have difficulty estimating how many merchandise packages must be prepared due to uncertain demand. This exclusive package will be sold for IDR 300,000/package, but if it doesn't sell, they will have to sell it on sale for IDR 150,000. the supplier however wants to know the exact number of packages they have to produce 3 months in advance. They offer the following production prices: IDR 190,000/package for an order of 70,000 packages, IDR 200,000/package for an order of 50,000 packages and IDR 220,000/package for an order of 25,000 packages. The demand that each alternative will generate for that day has been estimated using three possible scenarios. 1. Low demand; 30.000 packages 2. Medium demand; 60.000 packages 3. High demand; 70.000 packages Event's organizer estimates that there is a 20% chance that demand will be low demand, a 30% chance that it will be medium demand and a 50% chance that it will be high demand. Assuming that the Event's organizer's objective is to maximize profit, determine what decision should be made based on its profit?
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