The operations manager for a well-drilling company must recommend whether to build a new facility,expand his existing one,or do nothing.He estimates that long-run profits (in $000)will vary with the amount of precipitation (rainfall)as follows: If he feels the chances of low,normal,and high precipitation are 30%,20%,and 50%,respectively,what are expected long-run profits for the alternative he will select?
A)$140,000
B)$170,000
C)$285,000
D)$305,000
E)$475,000

Question

The operations manager for a well-drilling company must recommend whether to build a new facility,expand his existing one,or do nothing.He estimates that long-run profits (in $000)will vary with the amount of precipitation (rainfall)as follows:  If he feels the chances of low,normal,and high precipitation are 30%,20%,and 50%,respectively,what are expected long-run profits for the alternative he will select?
A)$140,000 
B)$170,000 
C)$285,000 
D)$305,000 
E)$475,000

Quizplus · Accepted Answer

The Answer of The operations manager for a well-drilling company must recommend whether to build a new facility,expand his existing one,or do nothing.He estimates that long-run profits (in $000)will vary with the amount of precipitation (rainfall)as follows:  If he feels the chances of low,normal,and high precipitation are 30%,20%,and 50%,respectively,what are expected long-run profits for the alternative he will select?
A)$140,000 
B)$170,000 
C)$285,000 
D)$305,000 
E)$475,000

The Operations Manager for a Well-Drilling Company Must Recommend Whether