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Dollar Department Stores has just acquired the chain of Wenthrope and Sons Custom Jewelers. Dollar...

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Dollar Department Stores has just acquired the chain of Wenthrope and Sons Custom Jewelers. Dollar has received an offer from Harris Diamonds to purchase the Wenthrope store on Grove Street for $120,000. Dollar has determined probability estimates of the store's future profitability, based on economic outcomes, as: P($80,000) -0.2, P(S100,000) = 0.3, P(S120,000) = 0.1, and P(S140,000) = 0.4. Should Dollar sell the store on Grove Street? b. What is the EVPI? Dollar can have an economic forecast performed, costing $10,000, that produces indicators / and I2, for which P180,000) = 0.1; P 100,000) -0.2, PC120,000) - 0.6; PC 140,000) - 0.3. Should Dollar purchase the forecast? Explain your answer. c TTT Arial : 3 (121) TE E . . 25 Path Words: 0

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