Chief appraiser for a large art dealer in a major american

Assignment Help Business Management

Reference no: EM1384546

Q. You are the chief appraiser for a large art dealer in a major American city. You are offered a chance to examine and buy a work of art. You have reason to believe which it is a piece from a famous artist of the 15th century which has been lost to the art world for hundreds of years. Such a painting would have an estimated market value of $1 million. Explain however, you face two risks. First, the painting may be a forgery, a chance which you estimate to be .4. Second, even if the painting is authentic it may be stolen. Once you buy the painting, you bear all risk. If it is a fake, its value is $0. If it proves to be stolen (a .2 risk in your estimation), you must return the painting to its rightful owner and you cannot recover the purchase price.

a) You have the chance to buy the painting for $500,000. As a risk-neutral decision maker, should you make the purchase?

Reference no: EM1384546

Questions Cloud

Strength of a semicrystalline polymer : Briefly explain how each of the following influences the tensile or yield strength of a semicrystalline polymer and why: (a) Molecular weight (b) Degree of crystallinity (c) Deformation by drawing (d) Annealing of an undeformed material

Determine size of address block to request from isp : Determine size of address block must you request from your ISP? How many class C equivalent addresses would you require? How many subnets would you have left over from your allocation?

Determine how much information a firm is obliged : Determine how much information a firm is obliged to tell a potential strategic alliance partner about what it expects to learn from the cooperative arrangemen

Find by what percent should the tension in string be changed : A particular guitar string is supposed to vibrate at 191- Hz, but it is measured to actually vibrate at 210- Hz. By what percent should the tension in string be changed to get the frequency to the correct value.

Chief appraiser for a large art dealer in a major american : You are the chief appraiser for a large art dealer in a major American city. You have the chance to buy the painting for $500,000. As a risk-neutral decision maker, should you make the purchase.

What speed does the man obtain as a result : A person with perfect pitch sits on a bus bench listening to the 441-Hz horn of an approaching car. If the person detects a frequency of 479 -Hz, how fast is the car moving.

Discuss the advantages and potential risks : Discuss the advantages and potential risks of such an approach, using specific examples to support your response.

Explain how would a corporation attract you enough to cause : explain how would a corporation attract you enough to cause you to leave your current (or past) employer and join them? As an employer, given which compensation.

Mass flow raw through the nozzle : Air enters an adiabatic nozzle steadily at 300 kPa, 200 o C, and 30 m/s and leaves at 100 kPa and 180 m/s. The inlet area of the nozzle is 80 cm 2 . Determine (a) the mass flow raw through the nozzle, (b) the exit temperature of the air, and (c) the ..

User Account

All Pages