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II.B - Using a Decision Tree to Make Decisions Under Uncertainty (10 points] A firm believes that the probability of a harmful cyberattack (see the Mini-Case "Risk of a Cyberattack) is 2596. It expects to make a profit of $200 million if no attack occurs and 5120 million is attacked. The firm can spend 55 million to increase its electronic defenses, which reduces the probability of a successful cyberattack to 106. Use a decision tree similar to Figure 14.4 to assess whether the firm should make this investment in the two following cases: A. The firm s utility function is W = 2 W. (3 points) B. The firms utility function is UW) = W0.5 (2.5 points) C. The firm's utility function is uw = W4 [3.5 points] A firm believes that the probability of a harmful cyberattack is 25%.It expects to make a profit of $200 million if not attach occurs and $120 million if attack occurs. The form can spend $5 million to increase its electronic defence which reduces the probability of a successful cyberattack to -0%.Use a decision to tree to access that whether the form should use the investment in the following two cases A: The firms utility function is U(W)=2 B: The firm's utility function is U(W) = W^0.5 C: The firm's utility function is U(W) = W^2 = = II.B - Using a Decision Tree to Make Decisions Under Uncertainty (10 points] A firm believes that the probability of a harmful cyberattack (see the Mini-Case "Risk of a Cyberattack) is 2596. It expects to make a profit of $200 million if no attack occurs and 5120 million is attacked. The firm can spend 55 million to increase its electronic defenses, which reduces the probability of a successful cyberattack to 106. Use a decision tree similar to Figure 14.4 to assess whether the firm should make this investment in the two following cases: A. The firm s utility function is W = 2 W. (3 points) B. The firms utility function is UW) = W0.5 (2.5 points) C. The firm's utility function is uw = W4 [3.5 points] A firm believes that the probability of a harmful cyberattack is 25%.It expects to make a profit of $200 million if not attach occurs and $120 million if attack occurs. The form can spend $5 million to increase its electronic defence which reduces the probability of a successful cyberattack to -0%.Use a decision to tree to access that whether the form should use the investment in the following two cases A: The firms utility function is U(W)=2 B: The firm's utility function is U(W) = W^0.5 C: The firm's utility function is U(W) = W^2 = =

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