An
excellent choice!
We see that a decision to "Litigate" now
has an expected cost of $700,000 -- calculated as shown in this diagram -- in
contrast to the expected cost of $500,000 which we anticipated in the example
originally.
(Sometimes, expected cost is expressed as an "expected
value". Expressed that way, here it would be an expected value of a
negative $700,000.)
To learn how to deal with some additional complexity, we encourage you
to go on to Tutorial 2 !
(Or would you prefer to return to the Introduction
or Tutorial 1
?)
Copyright © 2001 Michael D. Freeborn. All rights reserved.
