Robert Green repeatedly and painstakingly applied herbicides to kill weeds that would harm his sugar beet crops

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Robert Green repeatedly and painstakingly applied herbicides to kill weeds that would harm his sugar beet crops in 2007. However, in 2008, he planted beets genetically engineered to withstand Monsanto’s Roundup herbicide. Roundup destroys weeds but leaves the crop unharmed, thereby saving a farmer thousands of dollars in tractor fuel and labor (Andrew Pollack, “Round 2 for Biotech Beets,” New York Times, November 27, 2007). However, this policy is risky. In the past when beet breeders announced they were going to use Roundup- resistant seeds, sugar- using food companies like Hershey and Mars objected, fearing consumer resistance. Now, though, sensing that consumer concerns have subsided, many processors have cleared their growers to plant the Roundup- resistant beets. A Kellogg spokeswoman said her company was willing to use such beets, but Hershey and Mars declined to comment. Thus, a farmer like Mr. Green faces risks by switching to Roundup Ready beets. Use a decision tree to illustrate the analysis that a farmer in this situation needs to do.

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Managerial Economics and Strategy

ISBN: 978-0321566447

1st edition

Authors: Jeffrey M. Perloff, James A. Brander

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