Your company has finished working on an open world video game, CyberPerson 2080. You now have a decisioon to make. You can auction your game and do the marketing and publishing yourself. If you auction your game off, your analytics team estimates there is a 25% chance you will earn $5 millioon, a 35% chance you will earn $12 million, and a 40% chance you will earn $16 million. If you keep your game, your marketing and puvlishing costs will be $6 million. If you keep your game, your analytics team estimates there is a 50% chance your game will be a critical and commercial hit, a 10% chance your game will sell well and make gross revenues of $12 million, and a 40% chance another similar game will come oout at the same time and you will make gross revenues of $1 million. If your game is a critical and commercial hit, there is a 30% chance it is on the "best of the year" lists and makes gross revenues of $56 million, a 35% chance it stays on the top seller lists for weeks and makes gross revenues of $26 million, and a 35% chance it makes gross revenues of $20 million. Assume you make decisions using expected value, and you are an expected value maximizer. If you make the optimal decision, how much will you expect to earn from your game? Please answer in $ million, annd round your answer to 2 decimal places.
Your company has finished working on an open world video game, CyberPerson 2080. You now have a decisioon to make. You can auction your game and do the marketing and publishing yourself.
If you auction your game off, your analytics team estimates there is a 25% chance you will earn $5 millioon, a 35% chance you will earn $12 million, and a 40% chance you will earn $16 million.
If you keep your game, your marketing and puvlishing costs will be $6 million.
If you keep your game, your analytics team estimates there is a 50% chance your game will be a critical and commercial hit, a 10% chance your game will sell well and make gross revenues of $12 million, and a 40% chance another similar game will come oout at the same time and you will make gross revenues of $1 million.
If your game is a critical and commercial hit, there is a 30% chance it is on the "best of the year" lists and makes gross revenues of $56 million, a 35% chance it stays on the top seller lists for weeks and makes gross revenues of $26 million, and a 35% chance it makes gross revenues of $20 million.
Assume you make decisions using expected value, and you are an expected value maximizer. If you make the optimal decision, how much will you expect to earn from your game?
Please answer in $ million, annd round your answer to 2 decimal places.
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