Find the Expected Value of an Action

question 22

Multiple Choice

Find the expected value of an action.
-A farm owner in upstate New York who grows summer vegetables (e.g. tomatoes)
Must decide whether to employ additional pickers this season. If he does, he could hire
Either migrant workers or local teenagers who need summer employment. The migrant
Workers are more experienced, faster, but more expensive. Although the teenagers will
Work for less, they lack experience and tend to damage plants and produce. His profits
Depend on the growing season as shown below. Suppose the farmer's almanac predicts
The probability of a good growing season this year to be .75. What is the expected value
Of hiring teenagers?

• A) $62,500
• B) $52,500
• C) $46,250
• D) $12,990
• E) None of the above.

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Definitions:

Negative Sanctions

These are punishments or penalties imposed on members of a society or group for violating norms or laws.

Right

A moral or legal entitlement to have or do something.

Political Leaders

Individuals holding or seeking positions of governance or authority in a community, region, or nation, often responsible for making decisions that affect the collective.

Collective Body

A group of individuals or entities that act as a single entity, often for a specific purpose.