Problem 13-13 (Algorithmic) Seneca Hill Winery recently purchased land for the purpose of establishing a new vineyard. M

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Problem 13-13 (Algorithmic)
Seneca Hill Winery recently purchased land for the purpose ofestablishing a new vineyard. Management is considering twovarieties of white grapes for the new vineyard: Chardonnay andRiesling. The Chardonnay grapes would be used to produce a dryChardonnay wine, and the Riesling grapes would be used to produce asemidry Riesling wine. It takes approximately four years from thetime of planting before new grapes can be harvested. This length oftime creates a great deal of uncertainty concerning future demandand makes the decision about the type of grapes to plant difficult.Three possibilities are being considered: Chardonnay grapes only;Riesling grapes only; and both Chardonnay and Riesling grapes.Seneca management decided that for planning purposes it would beadequate to consider only two demand possibilities for each type ofwine: strong or weak. With two possibilities for each type of wine,it was necessary to assess four probabilities. With the help ofsome forecasts in industry publications, management made thefollowing probability assessments:
Revenue projections show an annual contribution to profit of$15,000 if Seneca Hill only plants Chardonnay grapes and demand isweak for Chardonnay wine, and $50,000 if Seneca only plantsChardonnay grapes and demand is strong for Chardonnay wine. IfSeneca only plants Riesling grapes, the annual profit projection is$20,000 if demand is weak for Riesling grapes and $55,000 if demandis strong for Riesling grapes. If Seneca plants both types ofgrapes, the annual profit projections are shown in the followingtable:
CHOOSE ONE: Tree (i)/ Tree (ii)/ Tree (iii)/ Tree (iv)
CHOOSE ONE: Plant Chardonnay/Plant both grapes/PlantRiesling
CHOOSE ONE: Plant Chardonnay/ Plant both grapes/ PlantRiesling
CHOOSE ONE: Plant Chardonnay/ Plant both grapes/ PlantRiesling