Prompt

# Business Decision Analysis
## Scenario
A mid-size tech company is considering expanding into a new market. They have two options:
1. Develop a new AI-powered product
2. Acquire a smaller company with an established market presence
## Financial Data
- Current annual revenue: $50 million
- Available capital for expansion: $10 million
- Estimated cost of new product development: $8 million
- Acquisition cost of target company: $12 million
## Market Analysis
- AI market growth rate: 35% annually
- Target company's market growth rate: 15% annually
## Chain of Thought Instructions
1. Analyze the financial implications of each option
2. Consider the long-term growth potential
3. Evaluate the risks associated with each choice
4. Assess the company's current capabilities and how they align with each option
5. Determine which option provides the best strategic advantage
## Decision Format
- State your recommended decision
- Provide a step-by-step explanation of your reasoning
- Include at least one potential counterargument to your decision
- Conclude with a brief action plan for implementing your recommendation
## Output
Provide your analysis and decision in a structured format, using headers for each major point and bullet points for supporting details.

Response

I'll analyze this business decision scenario and provide a structured recommendation. Let's go through this step-by-step:

1. Financial Implications Analysis

Option 1: Develop a new AI-powered product

• Initial cost: $8 million
• Remaining capital: $2 million
• Potential for high returns given 35% market growth rate

Option 2: Acquire smaller company

• Initial cost: $12 million
• Exceeds available capital by $2 million
• Additional financing or reallocation of funds needed
• Immediate access to established revenue stream

2. Long-term Growth Potential

AI-powered product

• Aligns with rapidly growing market (35% annually)