C207 QUM2 Data-Driven Decision Making QUM2 Task 2 Decision Tree Analysis passed complete task Western Governors University

1


C207 QUM2 Data-Driven Decision Making QUM2 Task 2
Decision Tree Analysis passed complete task Western
Governors University



QUM2 Task 2: Decision Tree Analysis



Western Governors

University C207 Instructor Alex

Neely

September 3, 2024

, 2


A. Business Question

Based on competitive market research and guidance from the FDA, would it be

appropriate for MPC to develop a brand-new drug line, modify its current one, or choose not

to make any changes?

B. Relevant Data Values

Probability of Success
Unfavorable Market Favorable Market
New Drug 31% 69%
Changes to Existing Drug Uses 39% 61%
No Changes 23% 77%


Demand
Unfavorable Market Favorable Market
New Drug 1355 4133
Changes to Existing Drug Uses 1911 5577
No Changes 258 657


Payoffs
Unfavorable Market Favorable Market
New Drug $ 880.75 $ 2,686.45
Changes to Existing Drug Uses $ 1,471.47 $ 4,294.29
No Changes $ 224.46 $ 571.59


Profits (per unit)
New Drug 0.65
Changes to Existing Drug Uses 0.77
No Changes 0.87