In the SciTools example, you might argue that there is a continuum of possible low competitor bids (given that there is at least one competing bid), not just four possibilities. In fact, assume the low competitor bid in this case is normally distributed with mean $118,000 and standard deviation $4500. Also, assume that SciTools will still either not bid or bid $115,000, $120,000, or $125,000. Use Excel’s NORMDIST function to find the EMV for each alternative. Which is the best decision now? Why can’t this be represented in a decision tree?
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