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

question 11

Multiple Choice

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: $$\begin{array} { | l | l | l | l | } \hline { \text { ALTERNATIVE } } & { \text { PRECIPITATION } } \\\hline& \text { LOW } & \text { NORMAL } & \text { HIGH } \\\hline \text { Do Nothing } & - 100 & 100 & 300 \\\hline \text { Expand } & 350 & 500 & 200 \\\hline \text { Build New } & 750 & 300 & 0 \\\hline\end{array}$$ If he uses the maximax criterion, which alternative will he decide to select?

• A) do nothing
• B) expand
• C) build new
• D) either do nothing or expand
• E) either expand or build new

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Definitions:

Autonomy

The capacity to make informed, uncoerced decisions independently, often viewed as an essential aspect of personal development and ethical principle.

Digital Natives

Individuals who have grown up using digital technology from an early age, often considered proficient in using the internet and electronic devices.

High-Speed Internet

Internet service with fast data transmission rates, enabling quicker access to online content compared to traditional dial-up connections.

Smartphones

Advanced mobile phones equipped with internet access and a wide variety of applications, functioning as portable, digital multi-tools.