2. Dwight Melody 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 following estimates of crop yields and net incomes per bushel under various weather conditions. Expected Yield, Bushels/Acre Weather Crop 1 Crop 2 Crop 3 Crop 4 Dry 20 15 30 40 Moderate 35 20 25 40 Damp 40 30 25 40 Net income per $1.00 $1.50 $1.00 $0.50 bushel After referring to historical meteorological records, Dwight also estimated the following prior probabilities for the weather during the growing season: Dry 0.3 Moderate 0.5 Damp 0.2

2. Dwight Melody 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 following estimates of crop yields and net incomes per bushel under various weather conditions. Expected Yield, Bushels/Acre Weather Crop 1 Crop 2 Crop 3 Crop 4 Dry 20 15 30 40 Moderate 35 20 25 40 Damp 40 30 25 40 Net income per $1.00 $1.50 $1.00 $0.50 bushel After referring to historical meteorological records, Dwight also estimated the following prior probabilities for the weather during the growing season: Dry 0.3 Moderate 0.5 Damp 0.2

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

Develop a decision analysis formulation of this problem by identifying the decision alternatives, state of nature, and the payoff table.

2. Dwight Melody 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 following estimates of
crop yields and net incomes per bushel under various weather conditions.
Expected Yield, Bushels/Acre
Weather
Crop 1 Crop 2
Crop 3
Crop 4
Dry
20
15
30
40
Moderate
35
20
25
40
Damp
40
30
25
40
Net income per
$1.00
$1.50
$1.00
$0.50
bushel
After referring to historical meteorological records, Dwight also estimated the following
prior probabilities for the weather during the growing season:
Dry
0.3
Moderate
0.5
Damp
0.2

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