Answer:
A) The extra $100 million spent on health care will not provide as much benefit as the previous $100 million due to diminishing marginal benefit.
Explanation:
The understanding of this question is based on the explanation of Diminishing Marginal Benefit
Diminishing Marginal Benefit is a law that states the an increase in the consumption of a thing while all other factor remain constant will reduce the marginal benefit or utility derived from the increased or additional unit.
Utility represents the benefit or satisfaction derived from consumption.
Based on this law, since $800 million has been spent on healthcare, every additional amount spent will bring in some benefit but will be at a diminishing rate. This means it will not provide as much benefit as the previous $100 million.
<span>0.75
The midpoint method is to calculate the percentage as the change in value divided by the average (or midpoint) of the new and old values. So the price of the sandwich changed from $5 to $7. Using the midpoint formula, you get
(7-5)/((7+5)/2) = 2/(12/2) = 2/6 = 0.3333 = +33.3%
The change in sandwiches due to the change in price is
(90-70)/((90+70)/2) = 20/(160/2) = 20/80 = 0.25 = +25%
The elasticity of supply will be the percentage change in demand divided by the percentage change in price. So
25/33.3 = 0.75
So the coefficient of elasticity is 0.75</span>
Answer:
The cost of underestimating demand is considered a revenue loss that arises due to cancellation of flight costing $125. Hence, cost of underestimating the demand is, 
= $125 .
The cost of overestimating the demand is known as rewards. For example. free round trip ticket worth $250. Hence. cost of overestimating the demand. 
= $250 .
Denote the optimal probability of tickets not being sold by P. The expression is shown below:
P = 0.3333
Hence. the optimal probability that the tickets are not being sold is 0.33.
Apply the formula, NORMSINV (0.3333) in the Excel spreadsheet
The value of z is obtained as -0.4308. The negative value of z indicates that the number of seats to be overbooked must be less than an average of 25.
As per the stated question, an average of 25 customers cancel or do not show for the flight. Also the standard deviation is 15.
Calculate the number of seats by which company SD should overbook the flight.
= Value of z x Standard deviation
= -0.4308 x (15)
= -6.462
Subtract the value. 6 from the average customers that do not show up for the flight.
25 - 6 = 19 seats
Hence, the airlines should overbook the flight by 19 seats .
The future value of a 500 annuity payment over wight years if interest rates are 14 percent is $6,616.38.
The value of an asset at a future date is its future value. It is the present value multiplied by the accumulation function, and it estimates the nominal future sum of money that a certain amount of money is "worth" at a given point in the future under the assumption of a specific interest rate, or rate of return. The value is unadjusted for inflation or any other future-related variables that may impact the real value of money. Calculations of the time worth of money use this.
The value of money changes over time; for example, $100 now is worth less than $100 in five years. This is because $100 invested today in a stock, a bond, or any other investment will grow or decrease depending on the rate of return. Additionally, due to inflation (an increase in the purchasing price), if $100 is used to acquire an item today, it's probable that $100 won't be enough to do so in five years.
Learn more about future value here:
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