Determine recommended decisions under each naive criterion for the following dec

Question

Determine recommended decisions under each naive criterion for the following decision process. in the fall, a farmer is offered $50000 for his orange crop, which will be harvested in the beginning of the following year. if the farmer accepts the offer, the money is his, ragardless of the quality or quantity of the harvest. if the farmer does not accept the offer, he must sell his oranges on the open market after they are harvested. under normal growing conditions, the farmer can anticipate receiving $70000 on the open market for his harvest. if he experiences a frost, however, then much of his harvest will be ruined, and he can anticipate receiving only $15000 on the open market.

Explanation / Answer

The sources of risk in agriculture are numerous and diverse. These range from events related to climate and weather conditions to animal diseases; from changes in agricultural commodities prices to changes in fertilizer and other input prices; and from financial uncertainties to policy and regulatory risks.

Quality and Quantity of Harvest is subject to Weather Conditions and Demand & Competition will be the factors affecting the Marketing of Orange Crops .

Scenario 1: Wherein a farmer is offered $50000 for his orange crop : Farmer should accept the offer Due to unpredicatable nature of agricultural products.

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