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Norma-Jean [14]
3 years ago
5

Chris Suit is administrator for Lowell Hospital. She is trying to determine whether to build a large wing on the existing hospit

al, a small wing, or no wing at all. If the population of Lowell continues to grow, a large wing could return $150,000 to the hospital each year. If a small wing were built, it would return $100,000 to the hospital each year if the population continues to grow. If the population of Lowell remains the same, the hospital would encounter a loss of $85,000 with a large wing and a loss of $45,000 with a small wing. Unfortunately, Suit does not have any information about the future population of Lowell.
Business
1 answer:
nalin [4]3 years ago
5 0

Answer:

A) Expected monetary value (EMV) is how much money you should expect to receive from different options. The EMV of both options are:

  • EMV large wing = (50% x $150,000) - (50% x $85,000) = $75,000 - $42,500 = $32,500
  • EMV small wing = (50% x $100,000) - (50% x $45,000) = $50,000 - $22,500 = $27,500

Since the EMV of the large wing is higher, then the large wing is the best alternative.

B) If the likelihood of the population growing reduces to 40% and the likelihood that it will remain unchanged increases to 60%, then the new EMVs for both options are:

  • EMV large wing = (40% x $150,000) - (60% x $85,000) = $60,000 - $51,000 = $9,000
  • EMV small wing = (40% x $100,000) - (60% x $45,000) = $40,000 - $27,000 = $13,000

Now the EMV of the small wing is higher, then the small wing is the best alternative.

C) EVPI is the expected value of perfect information, that means how much you are willing to pay to get the information you need to avoid any possible loss or increase your gains.

EVPI = EVwPi - highest EMV

EVwPi = (highest possible outcome of situation 1 x probability of situation 1) + (highest possible outcome of situation 2 x probability of situation 2)

  • situation 1 is the wing being built, and the highest possible outcome is $150,000 when the population grows.
  • situation 2 is not building anything at all, and the highest possible outcome is $0 when the population doesn't grow.

EVwPi = ($150,000 x 40%) + ($0 x 60%) = $60,000

EVPI = $60,000 - $13,000 = $47,000

This means that Chris would be willing to pay a maximum of $47,000 to know the perfect information about what investments should be carried out by the hospital.

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If the total assets of a business are $107,000 and its liabilities are $75,000, which of the following statements is correct?
Lady bird [3.3K]

Answer:

a. liabilities are $32,000

Explanation:

Note: In question part $75,000 shall represent equity, as there are only 3 parts of balance sheet assets, equity and liabilities, if assets are given liabilities is what we need to calculate the missing is equity.

Thus, $75,000 is treated as equity.

In that case we have,

Assets = Equity + Liabilities

$107,000 = $75,000 + Liabilities

Assets - Equity = Liabilities

$107,000 - $75,000 = Liabilities

$32,000 = Liabilities

Therefore, correct option is

a. liabilities are $32,000

7 0
3 years ago
The Operations Manager for Shadyside Savings & Loan orders cash from her home office for her very popular "BIG BUCKS" automa
notsponge [240]

Answer:

3,000 $100 bills equivalent to $300,000

Explanation:

The economic order quantity (EOQ) is the optimum quantity of a good to be purchased or required at a time in order to minimize ordering and carrying costs in inventory.

EOQ = the square root of [(2 times the annual demand in units times the incremental cost to process an order) divided by (the incremental annual cost to carry one unit in inventory)]

  • annual demand in units = 12,500 x 12 = 150,000
  • incremental costs to process an order = $300
  • incremental annual cost to carry one unit in inventory = 10% x 100 = $10

EOQ = √[(2 x 150,000 x $300) / $10] = √($90,000,000 / $10) = √9,000,000 = 3,000 bills

8 0
3 years ago
Concord Corporation had 807000 shares of common stock outstanding at December 31, 2021. In addition, it had 150000 stock options
Radda [10]

Answer:

846,000 shares

Explanation:

According to the scenario, computation of the given data are as follows:

Outstanding common stock = 807,000 shares

Outstanding option stock = 150,000

option price = $37

Market price of common stock = $50

So, 150,000 - (150,000 × $37 ÷ 50)

= 150,000 - 111,000

= 39,000

So, Number of shares = 807,000 + 39,000

= 846,000 shares

7 0
3 years ago
If a population consists of the positive even numbers through 30 aqnd if A= (2,6,12,24), what is A?
blondinia [14]
Um im sorry i tried idk
5 0
3 years ago
QS 6-4 Perpetual: Inventory costing with FIFO LO P1 A company reports the following beginning inventory and two purchases for th
pogonyaev

Answer:

$544

Explanation:

LIFO means last in first out. It means it's the last purchased inventory that is the first to be sold.

The cost of the 250 units sold would be first deducted from the inventory purchased on the 25th

= 100 × 2.34 = $234

That leaves 250 - 100 = 150 units.

The cost of goods sold would be next allotted to the inventory purchased on the 9th

= 50 × 2.20 = $110

This leaves 150 - 50 = 100

The cost of the 100 would be alloted to the beginning inventory

100 × $2 = $200

Total cost of goods sold = $200 + $110 + $234 = $544

I hope my answer helps you

5 0
3 years ago
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