Answer: Friedman doctrine
Explanation:
The Friedman Doctrine, also called the Shareholder Theory, is a theory which states that the main responsibility of a firm goes to its shareholders. The theory views the shareholders as the vital economic engine of organizations and the group to which firms are socially responsible to. The theory believes that the aim of the firm is to maximize profits to the shareholders.
The firm is responsible to the shareholders and the shareholders can then decide what social initiative they want to take part in. It is not the function of the firm to decide for them as they are there for business purposes alone.
Resources.
Human, natural resources.
Based on the information given, the best chart that can be used to represent the scenario will be an exploded pie chart.
A pie chart simply refers to a type of graph that's is used in displaying the data in a circular graph. In this case, the pieces are proportional to their fractions.
The exploded pie chart can be used in comparing the expenses in each department as a percentage of all expenses.
Learn more about our charts on:
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Answer:
Scenario 1: A risk-averse person will choose option B.
Scenario 2: A risk-averse person will choose option D.
Scenario 3: A risk-averse person will choose option F.
Explanation:
a) Data and Calculations:
Scenario 1:
Option A Winning Expected
Probability Value
50% $1,000 $500
50% 0 0
Total winning = $500
Option B Winning Expected
Probability Value
100% $500 $500
0% 0
Total winning = $500
Scenario 2:
Option C Winning Expected
Probability Value
40% $90 $36
60% 110 66
Total winning = $102
Option D Winning Expected
Probability Value
100% $90 $90
Scenario 3:
Option E Winning Expected
Probability Value
50% $0 $0
50% 100 50
Total winning = $50
Option F Winning Expected
Probability Value
50% $20 $10
50% 60 30
Total winning = $40
b) The risk-averse person tries to avoid risks at all times. Her choice of investment favors an option that has a 100% probability of winning, thereby eliminating risks in all ramifications. This is why she is never indifferent between two options as she factors in the probability of losing.
Answer:
(a) annual compounding = 5.063 %
(b) monthly compounding = 4.949 %
(c) continuous compounding = 4.939 %
Explanation:
given data
interest rate = 5 % = 0.05
solution
we get here equivalent rate for annual compounding
equivalent rate is express as
= 1 + r
r = 1.025² - 1
r = 5.063 %
and
now we get equivalent rate for monthly compounding that is
=
solve it we get
r = 4.949 %
and
now we get equivalent rate for continuous compounding
=
solve it we get
r = 4.939 %