You won the lottery and may choose between Prize 1, which would pay you $50,000 today and $200,000 at the end of 10 years OR rec
1 answer:
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Answer:
Thus, expected value of playing = $2.8 - $2 = $0.8
Explanation:
Cost of playing = $2
Expected return
10% chance to win $1 = $1 10% = $0.1
25% chance to win back $2 = $2 25% = $0.5
50% chance to win $5 = $5 50% = $2.5
15% chance to lose $2 (being cost) = $2 15% = ($0.3)
= $0.1 + $0.5 + $2.5 - $0.3 = $2.8
Now for this we have to pay fixed cost $2
Thus, expected value of playing = $2.8 - $2 = $0.8
Answer:
production.
Explanation:
Based on this model, households earn income when firms purchase resources from them. Households own labor (individuals' work) and capital (savings and investments) resources.
Firms earn income when households purchase goods and services from them.
