A riskadverse manager is considering two projects the first

Assignment Help Econometrics
Reference no: EM13378849

A risk=adverse manager is considering two projects. the first project involves expanding the market for hotdog; the second involves expanding the market for Champaign drink. There is a 10 percent chance for a recession and a 90 percent chance for a economic boom. During a boom, the hotdog project will lose $10,000.00 whereas the Champaign drink project will earn $20,000.00. During a recession, the hotdog project will earn $12,000.00 and the Champaign project will lose $8,000.00. If the alternative is earning $3,000.00 on government Treasury bill (T-bill), what should the manager do? Why?

Reference no: EM13378849

Questions Cloud

Summary outputregression statisticsmultiple r 0973178112r : summary outputregression statisticsmultiple r 0.973178112r square 0.947075637adjusted r square 0.9417832standard error
Nbspsuppose that a firm faces a demand curve that has a : nbspsuppose that a firm faces a demand curve that has a constant elasticity of -2. this demand curve is given by q
In 2003 the market price for a 3000 square foot home in : in 2003 the market price for a 3000 square foot home in south tampa florida was 350000 and 358 new homes were built. in
Compute the opportunity cost in forgone tanks for each : compute the opportunity cost in forgone tanks for each additional truck producedtruck output 0 1
A riskadverse manager is considering two projects the first : a riskadverse manager is considering two projects. the first project involves expanding the market for hotdog the
Two clothing stores in lowland mall are approached by a : two clothing stores in lowland mall are approached by a supplier with two lines to offer say formal or casual. the
Elaine as senior partner can make a take-it-or-leave it : elaine as senior partner can make a take-it-or-leave it offer to her junior partner john to undertake a project and
Jason is indifferent between 10 for sure and a lottery that : jason is indifferent between 10 for sure and a lottery that pays 100 with probability 0.09 and 0 with probability 0.91.
The company iie inc is considering upgrading their : the company iie inc. is considering upgrading their distribution center dc and have received investment proposal from

Reviews

Write a Review

Econometrics Questions & Answers

  Find the minimum cost of producing 10 units of output

Draw an iso-cost line for this firm, showing combinations of L and K that cost $6 and another iso-cost line showing combinations that cost $12. What are the slopes of these iso-cost lines Sketch the production isoquant depicting 10 units of output.

  What annual rate of interest is being earned on the fund

On january 1,2005, a person's saving account was worth $200,000. Every month thereafter, this person makes a cash contribution of $676 to the account. I f the funds is expected to be worth $400,000 on january 1,2010

  For the car market own price elasticity of demand is what

The supply curve for cars is given by the following: Qs = 2p-1000. Further the demand curve for cars is given by Qd = 8000 - p. In the equilibrium for the car market own price elasticity of demand (in absolute value terms) is equal to

  Find the marginal propensity to consume and to save

On the planet Omicron Persei 8, government spending is $1000, net taxes are $1200, and planned investment is $1400. Consumers spend according to the equation C = 100 + 0.8Yd, where Yd represents disposable income.

  How much will be repaid as a lump sum amount

a person has made an arrangement to borrow $1,000 now and another $1,000 two years hence. The entire obligation is to be repaid at the end of four years. If the projected interests rates in years one, two, three and four are 10%, 12%, 12%, and 14%..

  Determine the marginal revenue product function

Consider the following short-run production function ( where L =variable input, Q=output): Q=10L - 0.5 L2 Suppose that output can be sold for $10 per unit. Also assume that the firm can obtain as much of the variable input (L) as it needs at $20 p..

  Define what price would take to fill all the seats

assuming elasticity is linear and a plane flight holds 310 seats a load factor of 70 mean 70% of the seats are filled. a load factor of 72 means 72% of the seats are filled. what price would it take to fill all the seats.

  What would be the reserves of first commerce bank

Sharon sells a government security worth $4,600,000 to the Federal Reserve Bank of Kansas City. She then deposits the funds in her checking account at First Commerce Bank. Her checking account had a $150,000 balance before this deposit.

  Calculate the percentage changes using the midpoint formula

Suppose that the price elasticity for hip replacement surgeries is 0.2. Further suppose that hip replacement surgeries are originally not covered by health insurance and that at a price of $50,000 each, 10,000 such surgeries are demanded each year..

  What is the sample standard deviation of weights

What is the sample standard deviation of weights and calculate the change in weight

  Estimate the regression model

A security analyst specializing in stocks of motion picture industry the relation in number of movie theater tickets sold in December and the annual level of earnings in motion picture industry.

  How much would the man owe the lender at the time

A man borrows $250,000 to buy a house at the end of year 0 at a nominal 10% a year compounded quarterly. He arranges to make quarterly payments for 10 years, with the first quarterly payments occurring 6 months after receiving

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd