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3. Consider the following decision between investment projects to preserve species A or species B. Project A will invest $5 million to protect species A.
3. Consider the following decision between investment projects to preserve species A or species B. Project A will invest $5 million to protect species A. Project B will invest $50 million to protect species B. The impacts of the projects on the survival probability of the species are given in the following table. If preserved, species A provides $100 million in benefits. If preserved, species B provides $1 billion in benefits. Investment projects Species survival probability without protection Species survival probability with protection Value of species if preserved 50% 90% $100 million Project A for species A Project B for species B 5% 25% $1 billion Which project should be chosen if the objective is to maximize the expected net benefits from a project? In order to make a choice between these two projects, you have to explicitly calculate the expected net benefits from each project
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