# A builder has located a piece of property that she would like to buy

A builder has located a piece of property that she would like to buy and eventually build on. The land is currently zoned for 4 homes per acre, but she is planning to request new zoning. What she builds depends on approval of the zoning request and your analysis of this problem to advise her. With her input and your help the decision process has been reduced to the following costs, alternatives and probabilities:

Cost of land: 2 mill USD

Probability of rezoning: 60%

If rezoned, an additional cost of 1 mill USD

If the land is rezoned the contractor must decide whether to build a shopping center or 1.500 apartments. If she builds a shopping center she estimates 70% chance that she can sell it to a large department chain for 4 mill USD over her construction cost (which excludes the cost of land), and she estimates 30% chance that she can sell it to an insurance company for 5 mill USD over construction cost.

If instead of the shopping center she decides to build the 1.500 apartments she places probabilities on her profit as follows: 60% chance that she can sell the apartments for 3.000 USD each over construction cost and 40% that she gets only 2.000 USD for each apartment.

If the land is not rezoned she can only build 600 homes on which she expects to make 4.000 USD each over construction cost (as before excluding cost of land).

Draw a decision tree of this problem and determine the best solution and the expected net profit.

Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.

## Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.