Martha is CEO of a company called Boogle. She is risk-neutral and aims to maximize the firm's expected payoff. She must decide whether or not her firm should invest in Research and Development (R&D). Her advisors provide her with the following information to help her make her decision. Note that all payoftfs are in millions of dollars and represent present values of future net profits. + If the firm does not invest in R&D, its payoff will be $100. If the firm does invest in R&D, it will generate either innovation A or innovation B with equal probabilities (50% each). o Innovation A will be successfully commercialized with 75% probability, yielding a payoff of $240 for the firm. With 25% probability, innovation A will not be successfully commercialized, in which case the payoff to the firm will be $40. o Innovation B will be successfully commercialized with certainty, generating a payoff of $ 110. a. Should Martha's firm invest in R&D or not? Draw a game tree to illustrate your answer, and use backward induction to explain. b. Suppose a consultant could tell Martha with certainty whether or not - should the firm invest in R&D and generate innovation A innovation A could be successfully commercialized. What is the firm's expected payoff from learning this information from that consultant? Draw a game tree to illustrate your answer, and use backward induction to explain. What is the maximum Martha would be willing to pay the consultant for this information