Ratnagiri Alphonso Orchard: Bayesian Decision Analysis

內容大綱
In late 2012, the owner of the Ratnagiri Alphonso Orchard considered whether or not to purchase information from a climatology firm regarding the probability of unseasonable rains that could damage some or all of his family’s mango harvest. The owner needed to decide whether or not he should lease the orchard to a fruit merchant or keep the orchard for his family to harvest, despite the possibility of rain. Would the climatology firm provide helpful information, or should he make an independent decision? Regardless of whether he purchased information from the climatology firm, what was the best informed decision he could make?
學習目標
This case is suitable for graduate or undergraduate business courses in statistics and quantitative techniques, management science, or risk management and agri-business. Students are provided with the data needed to calculate the value of information and develop a decision tree. As a result of discussing this case, students will be able to:<ul><li>Understand the concepts of probability theory and apply those concepts to calculate probabilities;</li><li>Formulate a payoff table from a problem description;</li><li>Apply Bayes’ decision rule for decision analysis;</li><li>Formulate and solve a decision tree;</li><li>Evaluate the worth of decision-making information; and</li><li>Determine an agri-entrepreneur’s tolerance for risk.</ul></li>
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