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Consider the decision tree we constructed for IDEA in Session 1 of week 4. Assume that all of the data used in the example remain the same except for the probability of the market remaining weak or strong. Suppose that, instead of a 0.5 chance that the market is strong, the probability that the market is strong is now 0.6.
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Let’s say you have an expected revenue of $100,000. With the Rule of Thirds in mind, what should your upper limit for advertising spending be in dollars?
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A consumer package goods company has operations worldwide and is dealing with unionization pressures in some of the countries where it operates. How might the management best proceed?
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