Mountain Stat

Mountain States Electric Service is an electrical utility club serving several states in the Rocky Mountain region. It is considering successor some of its equipment at a generating substation and is attempting to decide whether it should replace an older, real PCB transformer. (PCB is a toxic chemical known formally as polychlorinated biphenyl) Even though the PCB generator meets all current regulations, if on incident occurred, such as a excitement, and PCB contamination caused combat injury either to neighboring businesses or farms or to the environment, the give- pony would be liable for damage. Recent court cases have shown that simply contact utility regulations does not relieve a utility of obligation if an incident causes harm to others. Also1 courts have been awarding large damages to individuals and businesses harmed by hazardous incidents.
If the utility replaces the PCB transformer, no PC incidents al secondary occur, and the only cost provide be that o the transformer, $85,000. Alternatively, if the corn pony decides to keep the alert PCB transformer, then management estimates thither is a 50â€"50 chance of there beingness a high likelihood of an incident or a low likelihood of an incident. For the case in which there is a high likelihood that an incident will occur, there is a 0.



004 prospect that a fire will occur erstwhile(prenominal) during the remaining life of the transformer and a 0.996 opportunity that no fire will occur. If a fire occurs, there is a 0.20 probability that it will be bad and the utility will perplex a very high cost of approximately $90 million for the cleanup, whereas there is a 0.80 probability that the fire will be minor and a cleanup can well-behaved at a low cost of approximately $8 million. If no fire occurs, then no cleanup be will occur. For the case in which there is a low likelihood of an incident occurring, there is a 0.00 1 probability that a fire will occur during the life of the existing transformer and a 0.999 probability that a fire will not...If you destiny to get a full essay, order it on our website: Ordercustompaper.com



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