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Help me question Farmington . Thank you You are given a 50 percent probability that oil reserves (discounted revernues) are 80 million dollars and a
Help me question Farmington . Thank you
You are given a 50 percent probability that oil reserves (discounted revernues) are 80 million dollars and a percent probability that oil reserves are 40 million dollars. It costs 50 million dollars to ddrill. Once a well in drilled, all drilling costs are non-recoverable, but it only costs 2 million dollars to test, before drilling Further, tests will determine whether high or low reserves are present. What is your strategyStep by Step Solution
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