?A pharmaceutical firm is evaluating a proposal to invest ? 1 , 0 0 , 0 0
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Question:
?A pharmaceutical firm is evaluating a proposal to invest ?in a research project to develop a new medicine. The research could either succeed or fail to develop a saleable product. Probabilities for success and failure are ?and ?If the research fails, the firm would drop the project. If the research succeeds, he firm could decide to either market the product or drop the project. If it decides to market the product, the product sales could be high probability ?or low probability ?If sales are high, the present value of cash inflow would be ?and if sales are low, the present value of cash inflow would be
You are required to present a decision tree for the above case, and evaluate the case after estimating its expected net present value
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