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Drisner Traders Ltd. is considering a move into overseas markets. The Australian company is deciding between two locations: Kazakhstan or South Korea. Market research
Drisner Traders Ltd. is considering a move into overseas markets. The Australian company is deciding between two locations: Kazakhstan or South Korea. Market research results are shown in the table below. All financial figures are in $ for ease of comparison. Kazakhstan Cost High return Low return Probability 0.6 0.4 Costs/Revenues ($) 250 000 Probability 400 000 250 000 South Korea Costs/Revenues ($) Cost 175 000 300 000 High return Low return (a) Construct a decision tree to show which of the two locations is best, based on financial grounds. 0.75 0.25 180 000 (b) Evaluate the value of decision trees as an organizational planning tool for Drisner Traders Ltd. [6 marks] (8 marks]
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