A farmer is considering planting five possible crop mixes. The outcomes depend on the weather (dry, average, or rainy). Assume the three possible weather states have probabilities: dry = 30%, average = 40%, rainy = 30%. Answer the following two questions.
Dry Average Rainy
Mix A -1 1 8
Mix B 5 -1 5
Mix C -1 3 4
Mix D 2 2 3
Mix E 3 0 -1
- A. B. C. D. E. F. G. H. I. J. Which planting decision has the highest expected monetary value?
- A. B. C. D. E. F. G. H. I. J. What is the expected value of perfect information?
A. mix A
B. mix B
C. mix C
D. mix D
E. mix E
F. 2.4
G. 2.5
H. 2.6
I. 2.8
J. 3.0