approved, the investor will have to sell the property at a loss. Profits (in thousands of dollars) are shown in the following payoff table: (a) If the probability that the rezoning will be approved is 0.5 , what decision is recommended? Recommended Decision: What is the expected profit? Enter your answer in dollars. For example, an answer of $200 thousands should be entered as 200,000 . (8) Let H= High resistance to rezoning L= Low resistance to rezoning P(H)=0.53P(s1H)=0.15P(s2H)=0.85 P(L)=0.47P(s1L)=0.88P(s2L)=0.12 What is the optimal decision strategy if the investor uses the option period to learn more about the resistance from area residents before making the purchase decision? High resistance: Low resistance: (c) If the option will cost the investor an additional $10,000, should the investor purchase the option? The investor purchase this option, as the payoff of the investing in it is than $10,000 dollars. EVSI = s (3)