Use the scenario given in Prob.16.3-12. (a) Draw and properly label the decision tree. Include all the

Question:

Use the scenario given in Prob.16.3-12.
(a) Draw and properly label the decision tree. Include all the payoffs but not the probabilities.
(b) Find the probabilities for the branches emanating from the event nodes.
(c) Apply the backward induction procedure, and identify the resulting optimal policy.