A nuclear power company is deciding whether to build a nuclear power plant at Diablo Canyon or at Roy

Rogers City. The cost of building the power plant is $10million at Diablo and $20 million at Roy Rogers

City. If the company builds at Diablo, however, and an earthquake occurs at Diablo during the next five

years, construction will be terminated and the company will lose $10 million (and will still have to build a

power plant at Roy Rogers City). Without further expert information the company believes that there is

a 20% chance that an earthquake will occur at Diablo during the next five years. For $1 million, a

geologist can be hired to analyze the fault structure at Diablo Canyon. She will predict either that an

earthquake will occur or that an earthquake will not occur. The geologists past record indicates that she

will predict an earthquake on 95% of the occasions for which an earthquake will occur and no

earthquake on 90% of the occasions for which an earthquake will not occur. Should the power company

hire the geologist?