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:
Alternative Precipitation
Low Normal High
Do nothing -100 100 300
Expand 350 500 200
Build new 750 300 0
If he feels the chances of low, normal, and high precipitation are 30 percent, 20 percent, and 50 percent respectively, What is EVPI (Expected value of Perfect Information)?
A. $140,000
B. $170,000
C. $285,000
D. $305,000
E. $475,000
Answer:
D. $170,000
Explanation:
The expected long run profits are for
Low Normal High
Do nothing -100*0.3 100*0.2 300*0.5 = 140
Expand 350*0.3 500*0.2 200*0.5 = 305
Build new 750*0.3 300*0.2 0*0.5 = 285
Therefore the expected long run profits are
$140,000
$305,000
$285,000
Based on his selected option being either to build new or to expand, the most profitable option is to expand
=$305,000
EVPI = EPPI-EMV =$170,000
Answer:
Convection currents are the result of different heating. Lighter material (warm) rises while heavier (cold) material sinks. This movement of the materials is what causes convection currents! (BTW, it happens in water, in the atmosphere, and in the mantle of Earth!
Explanation:
I hope this helps a little! :)
Answer:
D. Tidal energy is replaced naturally by the Moon's gravity.
Explanation:
The reason tidal energy is considered a renewable energy resource is that Tidal energy is replaced naturally by the Moon's gravity. The Moon's gravity creates bulges on the side of Earth that is closest and farthest from the Moon. These bulges also pull water causing high tides in those areas. As the Earth rotates these areas experience low tide while the areas that had low tide now experience high tide. This constant shift creates tidal energy every day, which is replenished naturally.
