1.An oil man, has a problem.He has an option on some land and he can either abandon the land or drill on it.The drilling will cost $60,000.If the oil-man drills and finds oil, he will immediately sell out to a major producer for $370,000. (This is payment price to the oil man by the major producer not the oil man's profit.) If the oil man abandons the land, his option runs out and he is at the status quo (i.e. at zero)

Before deciding whether to drill or not, the oil man can have performed at a cost of $10,000, a seismic sounding.This sounding reveals with certainty whether the structure of the land is type A (quite favorable to the existence of oil), type B (less favorable). Type C (quite un favorable) the probability of indicating A, B and C are .2, .2, .6 respectively.

The oil man assesses the prior probability of oil at .2.He then assesses the following probabilities: the chance of oil if A is quite high, namely, .6; the chance of oil if B is reasonable, namely, .4; the possibility of oil if C is non-existent (i.e. zero)

Find the oil man's optimal strategy and his expected value with this optimal strategy.Also, find EVPI

ALL SOLUTIONS AND EXPLANATION if possible please