Answered: Imagine you are a deep sea diver in…

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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Imagine you are a deep sea diver in search of lost treasure. You have it on good authority that there is a shipwreck off the coast of Maryland, in one of three locations (call them A, B, and C). Based on historical records of sea routes, you estimate that there is an 78% probability the ship is at location A, a 15% probability that it is at location B, and a 7% probability that it is at location C. Unfortunately, visibility and other diving conditions vary widely among the locations, affecting your chances of uncovering treasure: in a single dive, you estimate that you have only a 5% chance of finding a shipwreck at location A, while you have a 70% chance of finding a shipwreck at location B, and an 80% chance of finding a shipwreck at location C. a) If you can only dive once, which location do you choose to maximize your chances of finding the shipwreck? b) Suppose you dive in your chosen location, and do not find the ship. How does this change the probabilities of the ship being in each location? c) You have a chance for one more dive. Where do you go to maximize your chances? (you can go back to the same location if you want, and the dive will be independent of the previous dive)

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