Small Box Medium Large Box

Expected Return
Office Box Office Office
Movie Company $ 200 $ 1,000 $ 3,000 $ 960
TV Network $ 900 $ 900 $ 900 $ 900
max (Perfect Information) $ 900 $ 1,000 $ 3,000 $ 1,170

Prior Probabilities 0.30 0.60 0.10

RELIABILITIES
Favorable 0.30 0.60 0.80
Unfavorable 0.70 0.40 0.20

Joint & Marginal Probabilities

Favorable 0.09 0.36 0.08 0.53
Unfavorable 0.21 0.24 0.02 0.47
0.30 0.60 0.10 1.00

Posterior Probabilities
Favorable 0.170 0.679 0.151
Unfavorable 0.447 0.511 0.043

Market Research $ (100)

Expected Return w/Perfect Info $ 1,170
Expected Value of Pervice Info (EVPI) $ 210
Expected Return w/Sample Info $ 1,041
Expected Value of Sample Info (EVSI) $ 81
 Small Box Office Medium Box Office Large Box Office Expected Return
Movie Company 200 1000 3000 =SUMPRODUCT(B2:D2,$B$7:$D$7)
TV Network 900 900 900 =SUMPRODUCT(B3:D3,$B$7:$D$7)
max (Perfect Information) =MAX(B2:B3) =MAX(C2:C3) =MAX(D2:D3) =SUMPRODUCT(B4:D4,$B$7:$D$7)

Prior Probabilities 0.3 0.6 0.1

RELIABILITIES
Favorable 0.3 0.6 0.8
Unfavorable =1-B10 =1-C10 =1-D10

Joint & Marginal Probabilities

Favorable =B10*B7 =C10*C7 =D10*D7 =B14+C14+D14
Unfavorable =B11*B7 =C11*C7 =D11*D7 =B15+C15+D15
=SUM(B14:B15) =SUM(C14:C15) =SUM(D14:D15) =B16+C16+D16

Posterior Probabilities
Favorable =B14/$E14 =C14/$E14 =D14/$E14
Unfavorable =B15/$E15 =C15/$E15 =D15/$E15

Market Research -100

Expected Return w/Perfect Info =E4
Expected Value of Pervice Info (EVPI) =E4-E2
Expected Return w/Sample Info ='Decision Tree'!E39-'Decision Tree'!D39
Expected Value of Sample Info (EVSI) =E25-E2
 0.170
Small Box Office
100
200 100

0.679
Movie Company Medium Box Office
900
0 1066.038 1000 900

0.151
Large Box Office
0.53 2900
Favorable 3000 2900
1
0 1066.038 0.170
Small Box Office
800
900 800

0.679
TV Network Medium Box Office
800
0 800 900 800

0.151
Large Box Office
800
Market Research 900 800

-100 941 0.447

Small Box Office
100
200 100

0.511
Movie Company Medium Box Office
900
0 627.6596 1000 900

0.043
Large Box Office
0.47 2900
Unfavorable 3000 2900
2
0 800 0.447
Small Box Office
800
900 800

0.511
2 TV Network Medium Box Office
960 800
0 800 900 800

0.043
Large Box Office
800
900 800

0.300
Small Box Office
200
200 200

0.600
Movie Company Medium Box Office
1000
0 960 1000 1000

0.100
Large Box Office
3000
No Market Research 3000 3000
1
0 960 0.300
Small Box Office
900
900 900

0.600
TV Network Medium Box Office
900
0 900 900 900

0.100
Large Box Office
900
900 900