Petani Moden Sdn Bhd can plant either corn or soybeans. The probabilities that the next harvest prices of these commodities will go up, remain the same, or go down are 0.25, 0.25 and 0.50, respectively. If the price goes up, the corn crop will contribute an income of RM40,000 and soybean crop will contribute an income of RM20,000 to the company. If the price remains unchanged, the company will break even. But if the price goes down, the corn and soybeans will incur losses of RM35,000 and RM8,000 respectively to the company. Required:

a)Summarize the the above problem using a decision table.

b)Illustrate the problem using a decision tree.

c)Which crop should be planted?

d)Petani Moden could also secure additional information from a broker regarding the degree of stability of future commodity prices. The broker's assessment of the market is quantified by the following conditional probabilities (listed in table). Assume that the probabilityof favourable and unfavourable report is 50-50.

Probability

Market Research

Price Up (PU)

Unchanged (UC)

Price Down (PD)

Favourable

0.85

0.10

0.05

Unfavourable

0.10

0.10

0.80

i)Draw a decision tree for this new situation.

ii)Obtain the optimal decision for this problem.