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A City is planning to build a bridge over a riverthat has been experiencing increasing flood levels in recent decades. The city is considering three

A City is planning to build a bridge over a riverthat has been experiencing increasing flood levels in recent decades. The city is considering three different bridge designs. There are concerns that climate change and the consequent rise in flood levels would raise the maintenance and repair costs of the bridge. The city has analyzed the net present value of the bridge benefits in terms of economic development and the bridge construction and maintenance expenses under three conditions evolving during the next 100 years(based on the opinions of climate change experts): (i) no change in flood levels (with probability of 30%); (ii) moderate rise in flood levels (with probability of 60%); and (iii) extreme rise in flood levels (with probability of 10%). The net present values over 100 years associated with the three designs and these three flood levels are as follows:

Design No flood level change (30% probability) moderate rise in flood level (60% probability) extreme rise in flood level (10%probability)
1 $120 Million $60 Million $20 Million
2 $150 Million $ - 90 Million $ -120 Million
3 $90 Million $80 Million $60 Million

DETERMINE the preferred design for each of the following decsion criteria:

A)expected value

B) Most probable value

C) Long shot value

D) expected loss

E) most probably lost

F) Long shot loss

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