More Brit has enjoyed sailing onal boats since she was 7 years old when her mother stated salg with her. Today Monica considering the possibility of starting a company to prature small sales for the coal at Chille saboats, however, these boats will be made specifically for children between the ages of 10 and 15. The bow quality and extremely stable, and the sail size will be reduced to prevent problems of capsizing y be highes Her basic decision whether to build a large manufacturing facity, a anal manufacturing city one city a favorable market Monica can expect to make $9000 from the large city $40.000 hom the smaller facity the market is unfavorable, however, Monica estimates that she would lose $30.000 with a large city and she would only $20.00 with the small Because of the expense ined in developing the mids and acquing the cryptopherglass salbosts for young children, Monica has decided to conduct a pit study to make sure that the market for the beats will be adequate She estimates that the pit study will cost her $10.000 ble make to be Furthermore the pit study can be her favorable or unferable Monica that the bit of given a favorable pict study is 0.8. The probability of an unfavorable manet given an unfavorable pit study 0.9 Monica feels that there is a D65 chance that the plot study will be favorable. Of course, Monica cult bypass the pit study and she estimates that the probability of a favorable markets 06. What do you recomand Compute the EV Monics Decision Tre Lining Abati Stat Valves and Financial A. Calculate the EMV at each of the numbered nodes NODE 2 3 4 $ 6 7 1 Solution At each of the square nodes, the decisions would be NODE B Decision EMV D A C. Should Monica conduct a pilot study or not?, D. If Monica chooses to conduct the study what would be the expected value of sample information