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yawa3891 [41]
2 years ago
14

You are considering investing in a project with the following possible outcomes: States Probability of Occurrence Investment Ret

urns State 1: Economic boom 18% 20% State 2: Economic growth 42% 16% State 3: Economic decline 30% 3% State 4: Depression 10% -25%
Business
1 answer:
ololo11 [35]2 years ago
5 0

Based on the given states, their probability of occurrence, and the investment returns, the expected return would be 8.72%.

<h3>What is the expected return for this investment?</h3>

This can be found by the formula:

= ∑ (Probability of occurrence x Investment returns if state occurs)

Solving gives:

= (18% x 20%) + (42% x 16%) + (30% x 3%) + (10% x -25%)

= 3.60 + 6.72 + 0.90 - 2.50

= 8.72%

Question:

Find the expected value of the investment.

Find out more on expected value at brainly.com/question/24305645.

#SPJ1

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You open a savings account with a 0.5% per year nominal interest rate, and the economy experiences 3% per year inflation. a. Wha
Firlakuza [10]

Answer:

a. The nominal interest rate is 0.5%, and the real interest rate is -2.5%.

b. The purchasing power of money in the account will reduce.

Explanation:

a. What is the nominal and real annual interest rate on the account? The nominal interest rate is %, and the real interest rate is %.

From the question, we have:

Nominal interest rate = 0.5%

Inflation rate = 3%

In economics, the real is interest rate is calculated as follows:

Real interest rate = Nominal interest rate - Inflation rate = 0.5% - 3% = -2.5%

Therefore, the nominal interest rate is 0.5%, and the real interest rate is -2.5%.

b. What will happen to the purchasing power of the money you place in the account over time? The purchasing power of money in the account will

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3 0
3 years ago
If during 2009, the country of Sildavia recorded a GDP of $65 billion, interest payments of $15 billion, imports of $13 billion,
Maslowich

Answer:

36 billion

Explanation:

The GDP can be calculated using the income approach in which the output of a country is equal to the total income people receive in that country.

GDP= Compensation of employees + Net interest + Rental income + Corporate profits

From this formula, you can isolate the compensation of employees:

Compensation of employees= GDP-Net interest - Rental income - Corporate profits

Compensation of employees= $65-$15-$7-$7

Compensation of employees= $65-$29

Compensation of employees= $36

The wages during 2009 in Sildavida were: $36 billion.

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Are budgets part of the performance measurement system or the performance reward system? a. Part of neither the performance meas
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Answer:

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Both are linked according to the objectives and golas.

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3 years ago
Behavioral economistsLOADING... attribute some consumer behavior to the endowment effect. Which of the following is an example o
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Answer:  Option C

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