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Our movie studio is considering filming the Don Harnett story. We know that if the film is a flop, we will lose $4 million, and

"Our movie studio is considering filming the Don Harnett story. We know that if the film is a flop, we will lose $4 million, and if the film is a success, we will earn $15 million. Beforehand, we believe that there is a 10% chance that the Don Harnett story will be a hit. Before filming, we have the option of paying the noted movie critic Roger Alert $1 million to pre-review the script and predict whether the film will be a hit or flop. Of past films that Alert has pre-reviewed and that turned out to be hits, he has predicted a hit in 60% of the cases. Of past films that he has pre-reviewed that turned out to be flops, he has predicted a flop in 90% of the cases."

  1. Use a decision tree to find the highest-EMV course of action the movie studio can take regarding the Don Harnett story. State the policy and its EMV.
  2. What is the EVSI of hiring Roger Alert to pre-review the film?
  3. What is the EVPI in this situation?

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