DecisionBranch

Litigate or settle decision tree template

Take the offer or go to court?

Use this template
RecommendedAccept the settlement offerExpected value 120,000 · 28,000 ahead of Go to court

The tree

Settle or go to court?−40k55%60%40%45%Settle or go to court?EV 120,000→ Accept the settlement offerAccept the settlement offer120,000Go to courtEV 132,000WinEV 240,000Full damages awarded300,000Reduced damages150,000Lose0

Outline

# Analytical, from the claimant's side
Settle or go to court?
  Accept the settlement offer: 120000
  Go to court (cost 40000) # legal fees
    Win (p 0.55)
      Full damages awarded (p 0.6): 300000
      Reduced damages (p 0.4): 150000
    Lose (p 0.45): 0

How to use it

  1. Press Use this template. The tree opens in the editor, no account needed.
  2. Edit the outline on the left. Indentation is the tree; (p 0.4) is a probability, (cost 5000) a cost, : 200000 a payoff.
  3. Watch the expected value and the recommended branch update as you type. Open Analysis for the risk profile and the switch points.