Problem 1 Mr. Freeze Air Conditioning Inc. must decide whether to manufacture a component for its air conditioning units or purchase it from a supplier. The resulting profit is dependent upon the demand for the types of air conditioners in which it is used. The following payoff table shows the projected profit (in thousands of dollars): Alternative Manufacture Purchase Low -20 10 Demand Medium 40 45 High 100 70 The probabilities of for demand are 0.35 for low demand, 0.35 for medium demand, and 0.30 for high demand. a) Use a decision tree to recommend a decision to either manufacture or purchase the component part. b) Mr. Freeze has the option of conducting a market survey for $5,000. The survey will return a result that is either favorable or unfavorable. The probabilities for demand based on the survey result is listed in the table below: Favorable Survey Unfavorable Survey Survey Result 0.355 0.645 Low Demand 0.099 0.488 Medium Demand 0.394 0.326 High Demand 0.507 0.186 Using a decision tree what is the decision strategy for Mr. Freeze? c) What is the expected value of survey information