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nadezda [96]
1 year ago
6

alexander industries is considering purchasing an insurance policy for its new office building in st. louis, missouri. the polic

y has an annual cost of $10,000. if alexander industries doesn’t purchase the insurance and minor fire damage occurs, a cost of $100,000 is anticipated; the cost if major or total destruction occurs is $200,000. the costs, including the state-of-nature probabilities, are as follows: damage none minor major decision alternative s 1 s 2 s 3 purchase insurance, d 1 10,000 10,000 10,000 do not purchase insurance, d 2 0 100,000 200,000 probabilities 0.94 0.05 0.01
Business
1 answer:
Bingel [31]1 year ago
5 0

The best expected decision is d2.

The equation for the expected value for the lottery will be 200000 - 20000P

<h3>How to calculate the decision?</h3>

The expected value for d1 will be:

= 10000(0.96) + 10000(0.03) + 10000(0.01)

= 10000

The expected value for d2 will be:

= 0(0.96) + 100000 (0.03) + 200000 (0.01)

= 5000

Therefore, the best expected decision is d2.

b. The best outcome is 0 and the worst is given as -200000. Therefore, the expected value for the lottery will be:

= P + 200000(1 - P)

= 200000 - 20000P

Therefore, the best expected decision is d2 and the equation for the expected value for the lottery will be 200000 - 20000P.

Learn more about <em>insurance</em> on:

brainly.com/question/25855858

#SPJ1

Alexander Industries is considering purchasing an insurance policy for it's new office building in St. Louis, Mo. The policy has an annual cost of $10,000. If Alexander Industries doesn't purchase the insurance and minor fire damage occurs, a cost of $100,000 is anticipated: the cost if a major fire or total destruction occurs is $200,000. The cost, including state of nature possibilities are as follows:

Damage

decision alternative none s1 minor s2 major s3

purchase insurance d1 $10,000 10,000 10,000

Do not purchase insurance d2 0 100,000 200,000

probabilities .96 .03 .01

a. using the expected values approach, what decision do you reccommend?

b. What lottery would you use to access utilities?

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Moonbeam Company manufactures toasters. For the first 8 months of 2020, the company reported the following operating results whi
Lelu [443]

Answer:

Moonbeam Company

a) Incremental analysis for the special order:

Sales revenue ($7.87 * 20,800) =   $163,696

Variable costs ($6.62 * 20,800) =    (137,696)

Contribution margin =                        26,000

Shipping costs                                     (2,900)

Net income from special order =     $23,100

b) Moonbeam should accept the special order.  It generates some net income for covering the company's fixed cost and does not exceed the company's plant capacity.  It only adds about 4% to the operating plant capacity.

Explanation:

a) Data and Calculations:

                                        Total               Variable        Fixed

Sales (375,200 units)  $4,378,000  

Cost of goods sold        2,588,880      1,812,216       776,664

Gross profit                     1,789,120

Operating expenses        839,510        671,608        167,902

Net income                    $949,610

Total costs                                       $2,483,824    $944,566

Selling price = $11.67 ($4,378,000/375,200)

Variable costs per unit = $6.62 ($2,483,824/375,200)

Total plant capacity = 500,267 units (375,200/75%)

Increase in plant capacity = 396,000 (375,200 + 20,800)

6 0
3 years ago
The birthday rule is used to determine the:
-Dominant- [34]

Answer:

9.11

xplanation:㏒

The coinsurance amount is 9.11.  

Birthday of the dependent child is 1939-1945.

Date to play a claim is 1914-1918

Primary and secondary policy holders is 7/11.

<h2>Hope this helps! (: STAY SAFE AND BLESSED </h2>
8 0
2 years ago
A winning formula for many Answer E: Luxury brands is craftsmanship, heritage, authenticity, and history, often critical to just
Fittoniya [83]

Correct question:

A winning formula for many ________ brands is craftsmanship, heritage, authenticity, and history, often critical to justifying a sometimes extravagant price.

A) design

B) non durable

C) durable

D) ingredient

E) luxury

Answer:

E, luxury

Explanation:

When a product is being purchased irrespective of it price, the manufacturer is said to have found a winning formula.

from the above question, a luxury item that is authentic with an history behind it as well as exccellenct craftsmanship amongst other things ensure that the item is continually sold no matter what price it is.

Cheers.

4 0
3 years ago
The actual variable cost of goods sold for a product was $140 per unit, while the planned variable cost of goods sold was $136 p
kozerog [31]

Answer:

$326,400 is the variable cost quantity factor while $56,000 is the unit cost factor

Explanation:

The variable cost quantity factor is a measure of the difference between the planned and actual units  multiplied by planned variable cost.  

That is Variable Cost quantity factor = (planned units  - actual units sold) x        planned variable cost

                                                            = (14000-2400) - 14000) x $136

                                                            = (11600 - 14000) x $136

                                                            =  -$326,400

Unit Cost factor = $(140 - 136) x 14000 units

                          =$56,000

3 0
2 years ago
Read 2 more answers
Suppose an Exxon Corporation bond will pay $4,500 ten years from now. If the going interest rate on safe 10-year bonds is 4.25%,
Luda [366]

Answer:

The answer is a. $2,967.92

Explanation:

Calculation of prent value

Present value = p* (1+i)^-10

Present value = $4,500 * (1+0.0425)^-10= <u>$2,967.92</u>

4 0
3 years ago
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