BUS520 Module 4 CASE.docx - ETH501Business...

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ETH501Business Ethics (2017SEP05FT-3) DECISION TREE AND VALUE OF INFORMATION BUS520 Business Analytics and Decision Making Rey D’Angelo
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ETH501Business Ethics (2017SEP05FT-3) Introduction Diligent Consulting Group has learned of three different investment opportunities and needs to decide which one will yield the most profit. All three investments have its risks and a different required initial investment. Real Estate Development This investment is introduced as a risky opportunity with the possibility of a high payoff or, no payoff at all. Below are the details. Required Initial Investment: $750,000 o High NPV (Net Present Value): $5,000,000, Pr (Probability) = 0.5 o Medium NPV: $2,000,000, Pr = 0.3 o Low Npv: $0, Pr = 0.2 Just Hats Franchise This is a boutique-type of store selling fashion hats for men and women. This is said to be a risky opportunity less so than the real estate development. Being that it is a lesser risk, it also has a smaller payoff. Below are the details.
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