TP3-W8-S9-R0 (Dhadung P) [PDF]

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Tugas Personal ke-3 Minggu 08 / Session 09



Nama : Dhadung Prihananto NIM : 2140071352



The PT Geo Teknika (GT) owns a tract of land that may contain oil. A consulting geologist has reported to management that he believes there is oil with probability of 0.2. Because of this prospect, another oil company has offered to purchase the land for $120,000. However, PT GT is considering holding the land in order to drill for oil itself. The cost of drilling is $150,000. If oil is found, the resulting expected revenue will be $1,050,000, so the company’s expected profit (after deducting the cost of drilling) will be $900,000. A loss of $150,000 (the drilling cost) will be incurred if the land is dry (no oil). Table 1 summarizes these data. Determine the decision of whether to drill or sell based just on these data. Table1: Prospective profits for the PT Geo Teknika (GT). Status of Land



Payoff



Alternative



Oil



Dry



Drill for oil



$ 900,000



-$150,000



Sell the land



$ 120,000



$ 120,000



0.2



0.8



Probability of status



ISYE9001 - Engineering Optimization



Decision Making Without Experimentation Maximum Payoff Criterion  



 



  State of Nature Oil Dry 900 -150 120 120 0.2 0.8



Alternative Drill for oil Sell the land Prior Probability



 



 



Minimum -150 120 maximin value    



 



Application of the maximin payoff criterion  



    Alternative Drill for oil Sell the land



Prior Probability    



  State of Nature Oil Dry 900 -150 120 120 0.2



 



 



 



-150 120



 



maximum in this column



0.8 Maximum



 



 



 



Application of the maximum payoff criterion



Bayes Decission Rule E[Payoff (Drill)]= 0.2(900) + 0.8(-150) = 60 E[Payoff (Sell)] = 0.2(120) + 0.8(120) = 120 Payoff Sell > Payoff Drill, the alternative selected is to sell the land



ISYE9001 - Engineering Optimization