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Ma. Rosa is considering the possibility of opening a small dress shop on General Luna Ave., a few blocks from several schools. She has located
Ma. Rosa is considering the possibility of opening a small dress shop on General Luna Ave., a few blocks from several schools. She has located a good mall that attracts students. Her options are to open a small shop, a medium-sized shop, or no shop at all. The market for a dress shop can be good, average, or bad. The probabilities for these three possibilities are 20% for a good market, 50% for an average market, and 30% for a bad market. The net profit or loss for the medium-sized and small shops for the various market conditions are given in the following table. Building no shop at all yields no loss and no gain. What should Ma. Rosa decide
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