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shepuryov [24]
3 years ago
15

The shape of your utility function implies that you are arisk-averse individual, and, therefore, youwould accept the wager becau

se the difference in utility between A and C isless than the difference between C and B. Which of the following best explain why the pain of losing $3,000 exceeds the pleasure of winning $3,000 for risk-averse people? Check all that apply. The more wealth that risk-averse people have, the less satisfaction they receive from an additional dollar. The more wealth that risk-averse people have, the more satisfaction they receive from an additional dollar. Risk-averse people overestimate the probability of losing money. The utility function of a risk-averse person exhibits the law of diminishing marginal utility.
Business
1 answer:
Furkat [3]3 years ago
8 0

<u>Solution and Explanation:</u>

As the utility function is concave in shape, so person is risk averse.  Thus, he will not accept the gamvle.

The difference between utility at point A&C = 70 minus 65 = $5, is less than a the difference between A&B = 65 minus 55 = $10

<u>MCQ: </u>

Answer is option a&d  - risk averse people fear a lot for losing money, thus they overestimate the probability of loss

Since, shape of utility function is concave, hence the double derivative of utility with respect to wealth is negative, so utility falls at an decreasing rate , as wealth increases

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The normal time for a repetitive task that produced two work units per cycle is 3.0 min. The plan uses a PFD allowance factor of
VLD [36.1K]

Answer:

A.- 3.45 min to produce two work units

B.- In a 8-hout shift at standard performance 274 work units are produced

Explanation:

The Standart tiem per piece would be:

StandardTime=NormalTime*(1+PFD)

Given your numbers it will be:

3 * (1 + 0.15)= 3.45

This is the time per cycle to produce 2 work units

Now, in an 8 hours shift there are 480 minutes.  Dividing between the standard time of a cycle we get the standard performance

\frac{480}{3.45} = 137.14

Rounding, we will be getting 137 cycles

Lastly, because each cycle produce 2 work units we are having a total of 274 Units

3 0
3 years ago
Strait Co. manufactures office furniture. During the most productive month of the year, 3,300 desks were manufactured at a total
Elza [17]

Answer:

Using the high-low method of cost estimation, total fixed costs are $47,020  

Explanation:

Cost at highest level of activity = $82,000.00

Cost at Lowest level of activity = $59,000.00

Highest level of activity = 3,300

Lowest Level of activity = 1,130

Variable cost per unit = $(82,000 - 59,000) ÷ (3,300 -1,130)  

Variable cost per unit = $23,000 ÷ 2,170  

Variable cost per unit = $10.60  

Fixed Costs = $82,000 - (3,300 × 10.60)  

Fixed Costs = $47,020  

6 0
3 years ago
The following information pertains to Sooner Company's cash balance and bank reconciliation as of August 31: Company balance bef
MAXImum [283]

Answer: The correct cash balance for Sooner Company is "(C) $7,150."

Explanation: The balance of the company before the settlement was $ 5000. The data to take into account to adjust the differences are:

Notes collected by the bank $ 2,200

Service fee $ 50

<u>Therefore: 5000 + 2200 - 50 = $7150</u>

6 0
3 years ago
Two types of cars (Deluxe and Limited) were produced by a car manufacturer last year. Quantities sold, price per unit, and labor
frez [133]

Answer and Explanation:

Labor Productivity in Units per hour

Labor Hours Productivity(In units) =  Total Output / Input hours

For Deluxe Cars =  5,000 units / 21,250 hours = 0.24 units per hour (approx)

For Limited Cars =  6,250 units / 29,950 hours = 0.21  units per hour (approx)

Labor Productivity in dollars

Labor Hours Productivity(In dollars) =  Total Output in dollar / (Input hours x rates)

For Deluxe Cars =  (5,000 units x $8,500) / (21,250 hours x $13) = $42,500,000 / $276,250 = $153.84 per unit

For Limited Cars =  (6,250 units x $10,100) / (29,950 hours x $15) = $63,125,000 / $499,250 = $126.44 per unit

7 0
3 years ago
The Dante Manufacturing Company is considering a new investment. Financial projections for the investment are tabulated below. T
evablogger [386]

Answer:

a) incremental net income

net income year 1 = ($16,500 - $3,500 - $8,000) x 0.65 = $3,250

net income year 2 = ($17,000 - $3,600 - $8,000) x 0.65 = $3,510

net income year 3 = ($17,500 - $3,700 - $8,000) x 0.65 = $3,770

net income year 4 = ($14,500 - $2,900 - $8,000) x 0.65 =$1,340

b) incremental net cash flow

cash flow year 1 = [($16,500 - $3,500 - $8,000) x 0.65] + $8,000 - $430 = $10,820

cash flow year 2 = [($17,000 - $3,600 - $8,000) x 0.65] + $8,000 - $480 = $11,030

cash flow year 3 = [($17,500 - $3,700 - $8,000) x 0.65] + $8,000 - $380 = $11,390

cash flow year 4 = [($14,500 - $2,900 - $8,000) x 0.65] + $8,000 + $1,670 = $12,010

c) project's NPV

NPV = -$32,380 + $10,820/1.13 + $11,030/1.13² + $11,390/1.13³ + $12,010/1.13⁴ = $1,093.13

4 0
3 years ago
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