The decision tree costs and benefits of present value, Basic Statistics

Question:

Imagine that your client, Hillside County Forest Preserve (HCFP), is considering how best to protect their natural lagoons.  They have asked for your help, and you have found the following/

  • If they do nothing, the lagoons are sure to deteriorate and have a societal cost of $100,000
  • If they enact an experimental new program, called Lagoon Preservation Project ("LPP"), then there is a 50% chance that it will be successful, yielding a societal benefit of $70,000. There is a 50% chance it will not be successful, causing further harm to the lagoons, yielding a societal cost of $150,000
  • Enacting LPP will cost $10,000

Assume all costs and benefits above are expressed in present values.

a.  Which option has the higher expected benefit to society? Show the decision tree that supports your answer.

b.  What would the likelihood of success of LPP need to be for enacting it to have the same Expected Value as not enacting it?

Posted Date: 2/16/2013 7:52:07 AM | Location : United States







Related Discussions:- The decision tree costs and benefits of present value, Assignment Help, Ask Question on The decision tree costs and benefits of present value, Get Answer, Expert's Help, The decision tree costs and benefits of present value Discussions

Write discussion on The decision tree costs and benefits of present value
Your posts are moderated
Related Questions
What is it that created the numerical relationship between a chi square test and a z test?

To study what fraction of houses for sale in Victoria has a finished basement, a researcher selected a random sample of 20 houses that were on the market. It was found that 11 of t

Accounting for inflation Inflation sales is a term reporting a range of sales systems designed to correct problems that comes from traditional cost sales in the use of inflation. I

difference between financial statement and annual report .

United States: There are currently more than 10000 companies that are registered with the SEC (Securities Exchange Commission). Of these, around 1000 are non US companies. The non

At a tennis tournament a statistician keeps track of every serve. The statistician reported that the mean serve speed of a particular player was 102 miles per hour (mph) and the st

what are the different types of transfer pricing?

advantages and disadvantages of integrated economic statistics

Find the number of different ways in which the 9 letters of the word GREENGAGE can be arranged if exactly two Gs are next to each other?

If in a hall there are 18 persons then how many handshakes are possible?