Example $3-7$

a$)$ Using the EMV criterion, select the most economical facility size without obtaining any additional information.

b$.$ Calculate the expected value of perfect information using EMV and EOL. Based on the EVPI, how much maximum can be paid to acquire additional information?

c$.$ Calculate the expected value of imperfect information if it is decided to drill delineation wells at a cost of $\backslash (15\backslash$mathrm$\{$MM$\}\backslash$$ $\backslash )$ before deciding on the size of facilities. The geologists consider that $($i$)$ there is a $\backslash (90\backslash \%\backslash )$ chance that the delineation wells will show large reservoir, $($ii$)\backslash (60\backslash \%\backslash )$ chance that it will show medium reservoir, and $($iii$)\backslash (30\backslash \%\backslash )$ chance that it will show small reservoir.

d$.$ Rework the Fig $3\mathrm{.}8($posterior probabilities$).$ refer to the book, Project Economics and Decision Analysis, Volume $2$: Probabilistic Models.