consider a company faced with a competitors price reduction. Should the company also reduce price in order to maintain market share or should the company maintain its current price? The company has conducted some preliminary research showing the financial outcones of each decision under two competitor responses; the competition maintains its price or the competition lowers its price further. The company feels pretty confident that the comprtitor cannot lower its price furthrr and assigns that outcome a probability (p) of 0.6, which means the otger outcome would have only a 40 percent chance of occurring (1-p=0.4). These outcomes are shown in the table below.

The expected monetary value of reducing the price is $ (round to the nearest dollar)

Competitive Response Company action Maintain Price Reduce Price (1-p) - 0.4 $135,000 $115,000 p 0.6 Reduce Price $165,000 $175,000 Maintain Price