Statistics for Decision Makers - 29.01 - Decision Trees

Example 1 。

What should we invest money in?

Symbol	Meaning
	decision node
	uncertainty, event, chance node
	end node

What should we invest money in?

A company thinks about introducing a new social networking platform called GooGl-.
Because GooGl- would need to compete with existing platforms like FaceHook, Witter or WeiBu, there is a good chance that it will fail (98%)
The company estimates that initial investment would be $10 million
If they succeed, the business could be worth around $1 billion
Should the company launch the GooGl- platform?

Imagine that NobleProg wants to invest in self-study, but the major cost is developing a testing platform

NobleProg is using Drupal, an open source software
It is possible that the community develop part of the modules which NobleProg require in the next two months (0.9), and the cost will decrease from 400 to 200
In this case our EV is 180 for the "wait" scenario