Your firm has developed a new product aimed at the European and Asian markets. For each of these two markets, you have identified two possible sales scenarios, called "good" and "bad", with the following joint probabilities:

Europe Good Europe Bad

Asia Good 0.6 0.1

Asia Bad 0.2 0.1

That is, there is a 60% chance the products sales will be good in Asia and Europe, a 10% chance they will be good in Asia but bad in Europe, and so forth. You have four possible courses of action: ? Introduce the product simultaneously in Europe and Asia ? Introduce it in Asia first. After it becomes apparent whether sales are good or bad, decide whether to introduce it in Europe, one year later. ? Introduce it in Europe first. After it becomes apparent whether sales are good or bad, decide whether to introduce it in Asia, one year later. ? Abandon the product.

The NPV's of the various scenarios are as follows, in millions of US dollars:

\f