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A hospital group has to replace its old MRI and related equipment. Two choices are under consideration: one is to invest in technology similar to
A hospital group has to replace its old MRI and related equipment. Two choices are under consideration: one is to invest in technology similar to What they have used but a newer model, the other is to try a newer technology that promises higher eiciency and signicantly clearer results, m! may not m as advertised. The following table shows the anticipated prots ($000) under the two choices and two states of nature. New Technology works as New Technology does not Choice advertised work as advertised Current Technol - LA New Technolot The hospital group esmates that the probability of the new MRI equipment works as advertised as .30 Draw a decision tree for the hospital group (to the left on this worksheet). What is the optimal solution and their expected value? What is EVPI? ROUND ALL DECIMALS T0 HUNDREDS
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