The WH meat-packing company must decide whether or not to recall one week's production of kielbasa due to possible contamination. An outbreak of non-fatal food poisoning may be linked to WH. If so, WH may face a lawsuit. The tree below summarizes the decision.

The EMV of the cost ofnotissuing a recall is $80,000. Based on EMV, WH should not issue a recall. An estimated value of a reputation loss is included in the outcome estimate of the lawsuit. If WH is implicated, the firm may face a reputation loss even if no lawsuit is filed. For what values of that reputation loss would issuing the recall be preferable, in terms of EMV?

• Higher than $500,000
• Lower than $500,000
• Lower than $44,444
• None of the above

Expected Costs EMV: $ 800,000 Lawsuit $4,000,000 20% WH Implicated EMV: $ 80,000 10% No Lawsuit 50 Don't Recall 80% WH Not Implicated 50 90% Recall $120,000