Which grant should you apply for

Assignment Help Corporate Finance
Reference no: EM13213810

You are in charge of development for your housing nonprofit and two new grant opportunities have come to your attention. Unfortunately, both grant applications are due tomorrow and you will only have the time to write an application for one of them.

The first grant is sponsored by the county government. Assuming you choose to apply for this grant, your nonprofit will have a 40% chance of winning $450,000 in grant money, a 50% chance of winning $200,000 in grant money, and a 10% of receiving no grant money.
The second grant is sponsored by the federal government. While the monetary amounts associated with this grant are larger, the odds of a successful application are also lower. Assuming you choose to apply for this grant, your nonprofit will have a 20% chance of winning $1,000,000 in grant money, a 20% chance of winning $500,000 in grant money, and a 60% chance of receiving no grant money.

a. Assuming that your non-profit is risk-neutral, which grant should you apply for?

b. Assuming that your non-profit is risk-averse, with U(X)=sqrt(X) where X is the amount of grant money received, which grant should you apply for?

Reference no: EM13213810

Questions Cloud

Explain formula of a hydrocarbon containing five carbon atom : Give the molecular formula of a hydrocarbon containing five carbon atom containing five carbon atoms that is (a.) an alkane, (b.) a cycloalkane, (c.) an alkene, (d.) an alkyne
Compute the number of formula units of the compound : Calculate the number of formula units of the compound and the number of each ion in 3.75 moles of AlCl3.
Analyze and interpret any significant results : Compute increases in percents for both Years 6 and 7 by entering all the missing data in the table below. Analyze and interpret any significant results revealed from this trend analysis.
Explain what is the specific heat of the metal : assume no cooling of the metal during transfer. When thermal equilibrium is attained, the temperature of wate-plus-metal has risen to 28.8*C
Which grant should you apply for : Assuming that your non-profit is risk-neutral, which grant should you apply for - assuming that your non-profit is risk-averse, with U(X)=sqrt(X) where X is the amount of grant money received, which grant should you apply for?
What is the future value of all the costs of owning : A company is considering buying a new bottle-capping machine. The initial cost of the machine is $325,000 and it has a 10-year life. Monthly maintenance costs are expected to be $1200 per month for the first 7 years and $2000 per month for the rem..
Diaphoresis-macule-ulcer-epidermis : Diaphoresis, Macule, Ulcer, Epidermis, Ecchymosis, Wheal
Determine the volumetric flow rate : Liquid phenol (C6H5OH) flows through a pipe with a mass flow rate of 83.0 g/s. Given that the density of phenol is 1.0576 g/cm3
What are the maximum profits this firm can earn : On page 170 A firm's product sells for $per unit in a highly competitive market. The firm produces output using capital (which it rents at $75 per hour) and labor (which is paid a wage of $15 per hour under a contract for 20 hours of labor service..

Reviews

Write a Review

Corporate Finance Questions & Answers

  Impact of the global economic crisis on business environment

This paper reviews the article of ‘the impact of the global economic crisis on the business environment' that is written by Roman & Sargu (2011).

  Explain the short and the long-run effects on real output

Explain the short and the long-run effects on real output, price, and unemployment

  Examine the requirements for measuring assets

Examine the needs for measuring assets at fair value in accounting standards

  Financial analysis report driven by rigorous ratio analysis

Financial analysis report driven by rigorous ratio analysis

  Calculate the value of the merged company

Calculate the value of the merged company, the gains (losses) to each group of shareholders, NPV of the deal under different payment methods. Synergy remains the same regardless of payment method.

  Stock market project

Select five companies for the purpose of tracking the stock market, preparing research on the companies, and preparing company reports.

  Write paper on financial analysis and business analysis

Write paper on financial analysis and business analysis

  Intermediate finance

Presence of the taxes increase or decrease the value of the firm

  Average price-earnings ratio

What is the value per share of the company's stock

  Determine the financial consequences

Show by calculation the net present value for the three alternatives (no education, network design certification, mba). Also, according to NPV suggest which alternative you advise your friend to choose

  Prepare a spread sheet model

Prepare a spread sheet model for the client that determines NPV/IRR with and without tax.

  Principles and tools for financial decision-making

Principles and tools for financial decision-making. Analyse the concept of corporate capital structure and compute cost of capital.

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