IB Business Management HL 6.1.6 Decision Trees Questions

Practise analysing strategic options with decision trees and expected outcomes for IB Business Management HL using real exam-style questions and mark schemes.

Syllabus
First assessment 2024
Course
Business management HL
Level
HL

Exam points

  • Analyse strategic options using decision trees and expected outcomes.

IB Business Management HL 6.1.6 Decision Trees Questions question 1

[Maximum number: 8]

Sassy
Sassy, a partnership between fashion designers, produces clothes for teenagers. Capacity utilization is very high.
The partners are considering some strategic changes. After conducting research, they presented three options and outlined the costs and expected revenue. They also predicted that the economy would either improve or stay the same. The probability of the economy staying the same is 0.3 .
The options, costs and expected revenue are given below:

Table 1: Information relating to the three strategic options for change

Table 1: Information relating to the three strategic options for change

Question (a)

(a)

Construct a fully labelled decision tree and identify the best option for Sassy (show all your working).

[ 6 ]

Question (b)

(b)

Explain one limitation for Sassy of using a decision tree as a planning tool.

[ 2 ]
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