Meredith Delgado owns a small firm that has developed software for organizing and playing music on a

computer. Her software contains a number of unique features that she has patented so her company$$s

future has looked bright.

However, there now has been an ominous development. It appears that a number of her

patented features were copied in similar software developed by MusicMan Software, a huge software

company with annual sales revenue in excess of $$1$ billion. Meredith is distressed. MusicMan Software

has stolen her ideas and that company$$s marketing power is likely to enable it to capture the market and

drive Meredith out of business.

In response, Meredith has sued MusicMan Software for patent infringement. With attorney fees

and other expenses, the cost of going to trial $($win or lose$)$ is expected to be $$1\mathrm{.}25$ million. She feels that

she has a $40\%$ chance of winning the case, in which case she would receive $$4\mathrm{.}25$ million in damages. If

she loses the case, she has to pay $$1\mathrm{.}25$ million in cost$.$ IF she settles, she obtains $$1$M$.$ If doesn$$t

decide to settle or go to trial... she settles for $$0.$

A$)$ Construct a model using the Bayes$$ Decision Rule.

B$)$ Construct a Table using:

a$.$ Prior Probabilities of Winning $($in percentage, starting at $36\%$ to $45\%)$

b$.$ Prior Probabilities of Losing $($in percentage, compared to Winning side$)$

c$.$ Go to Trial $($EP$)$

d$.$ Settle $($EP$)$

e$.$ Y or N for Decision to go to trial.

C$)$ Put your Prior Probability values to the values where EP for going to trial is $$50,000$ more than

settling.Rule for Meredith Delgado