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Each question is worth one point, unless otherwise stated 1) Consider the following decision tree. .40 1 A B $3,000 .60 -$1,000 3 .20

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Each question is worth one point, unless otherwise stated 1) Consider the following decision tree. .40 1 A B $3,000 .60 -$1,000 3 .20 80 .80 $2,500 $2,000 $1,800 Which decision, A or B, is best? What is the expected value of this decision? What assumption did you make? (3 points)

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