You operate a snow-removal company during each winter, maintaining the driveways and sidewalks of customers in your area. The amount of profit you make in a given year depends mainly on the amount of snowfall in that year. A harsh winter (lots of snow) yields $30,000 profit, a regular winter yields $20,000 profit, and a mild winter (little snow) yields $10,000 profit. For this coming winter, there is a 30% chance for a harsh winter, and a 20% chance for a mild winter.

Actually you have another option this coming winter. The city wants to hire you to assist with the its snow removal and will pay you a fixed amount whatever the severity of the winter. This fixed payment translates into $18,000 profit for the winter. If you accept the city’s offer, however, you will be unable to serve any regular customers.

Setup (but do not fold back!) a decision tree to determine whether you should accept the city’s offer. Be sure to use the correct symbols, to label all items accurately, and to include the terminal values!