Question

Problem 3. Dwight Moody is the manager of a large farm with 1,000 acres of arable land. For greater efficiency, Dwight always devotes the farm to growing one crop at a time. He now needs to make a decision on which one of four crops to grow during the upcoming growing season. For each of these crops, Dwight has obtained the estimates of crop yields and net incomes per bushel under various weather conditions. After referring to historical meteorological records, Dwight also estimated the probabilities for the weather during the growing season: Expected Yield, Bushels per acre 1 40 20 30 WeatherCrop 1 Crop 2 Crop 3 Crop 4Probability Dry 20 40 35 30 45 15 0.47 0.06 0.47 eerate20Cron 15 Wet Which crop should Dwight grow according to (a) maximin criterion (b) expected payoff criterion (c) minimax regret criterion (d) what is Dwight's EVPI in this case?

Answer 1

Ans: Dwight moody is the manager of the large farm with 1000 acres of arable land. For greater efficiency, Dwight always devotes the farm to growing one crop at a time.