Process Management

) EV (node3)= 0.5($2,000,000) + 0.5($500,000) = $1,250,000

EV (node2)= 0.5($1,250,000) + 0.5(-$75,000) = $587,500

c) For the final decision,

suit: $587,500

offer: $600,000

Since the higher value is $600,000, I recommend Mary to accept compensation from the car company which is $600,000 after the costs rather than suing the manufacturer.

) EV (node3)= 0.5($2,000,000) + 0.5($500,000) = $1,250,000

EV (node2)= 0.5($1,250,000) + 0.5(-$75,000) = $587,500

c) For the final decision,

suit: $587,500

offer: $600,000

Since the higher value is $600,000, I recommend Mary to accept compensation from the car company which is $600,000 after the costs rather than suing the manufacturer.

) EV (node3)= 0.5($2,000,000) + 0.5($500,000) = $1,250,000

EV (node2)= 0.5($1,250,000) + 0.5(-$75,000) = $587,500

c) For the final decision,

suit: $587,500

offer: $600,000

Since the higher value is $600,000, I recommend Mary to accept compensation from the car company which is $600,000 after the costs rather than suing the manufacturer.

) EV (node3)= 0.5($2,000,000) + 0.5($500,000) = $1,250,000

EV (node2)= 0.5($1,250,000) + 0.5(-$75,000) = $587,500

c) For the final decision,

suit: $587,500

offer: $600,000

Since the higher value is $600,000, I recommend Mary to accept compensation from the car company which is $600,000 after the costs rather than suing the manufacturer.