Glenn Foreman, president of Oceanview Development Corporation, is considering submitting a bid to purchase property that will be sold by sealed bid at a county tax foreclosure. Glenn's initial judgment is to submit a bid of $5 million. Based on his experience, Glenn estimates that a bid of $5 million will have a 0.2 probability of being the highest bid and securing the property for Oceanview. The current date is June 1. Sealed bids for the property must be submitted by August 15. The winning bid will be announced on September 1.

Cost and Revenue Estimates:

Revenue from condominium sales- $15,000,000

Cost: Property- $5,000,000;Construction Expenses- $8,000,000.

P(A | s1) = 0.9 ...... P(N | s1) = 0.1

P(A | s2) = 0.2 ...... P(N | s2) = 0.8

A = Prediction of zoning change approval

N= Prediction of zoning change will not be approved

s1= The zoning change is approved by the voters

s2= The voting change is rejected by the voters

Managerial Report

Perform an analysis of the problem facing the Oceanview Development Corporation, and prepare a report that summarizes your findings and recommendations. Include the following items in your report:

1. A decision tree that shows the logical sequence of the decision problem

2. A recommendation regarding what Oceanview should do if the market research information is not available

3. A decision strategy that Oceanview should follow if the market research is conducted

4. A recommendation as to whether Oceanview should employ the market research firm, along with the value of the information provided by the market research firm Include the details of your analysis as an appendix to your report.