Determine the probability that the following tree reflecting demand for a product, given an expense of acquiring the necessary equipment of $100k, has a rate of return higher than 30% per year. Sales: $27k/yr4 yaDecideSales: $26k per year with a $35k overhaul in yr 4Low demapd p=0.35$100k acquisition costHigh demand p=0.65Sales $4SK/I10 sDecide12 yrSSales $35k per year with a $35k overhaul in yr 6

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Determine the probability that the following tree reflecting demand for a product, given an expense of acquiring the necessary equipment of $100k, has a rate of return higher than 30% per year.

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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Question

Determine the probability that the following tree reflecting demand for a product, given an expense of acquiring the necessary equipment of $100k, has a rate of return higher than 30% per year.

Sales: $27k/yr
4 ya
Decide
Sales: $26k per year with a $35k overhaul in yr 4
Low demapd p=0.35
$100k acquisition cost
High demand p=0.65
Sales $4SK/I
10 s
Decide
12 yrS
Sales $35k per year with a $35k overhaul in yr 6

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