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Home » Business Ethics

#### Business Ethics

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 The opportunity loss for the combination "Purchase New Equipment" and "High" is ___. a) 0.0 b) 0.5 c) 2.5 d) 3.0 e) 3.5

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 The opportunity loss for the combination "Purchase New Equipment" and "Low" is ____. a) 0.5 b) 1.5 c) 2.5 d) 3.0 e) 3.5

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 If Trey uses the Hurwicz criterion with alpha = 0.4, the appropriate alternative would be: _____________. a) Lease New Equipment b) Purchase New Equipment c) Add Third Shift d) Do Nothing e) Do everything

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 If Trey uses the Hurwicz criterion with alpha = 0.1, the appropriate alternative would be: _____________. a) Lease New Equipment b) Purchase New Equipment c) Add Third Shift d) Do Nothing e) Do everything

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 If Trey uses the maximin criterion, the appropriate alternative would be: _____________. a) Lease New Equipment b) Purchase New Equipment c) Add Third Shift d) Do Nothing e) Do everything

**Q:**Trey Leeman, Operations Manager at National Consumers, Inc. (NCI), is evaluating alternatives for increasing capacity at NCI's Fountain Hill plant. He has identified four alternatives, and has constructed the following payoff table which shows payoffs (in $1,000,000's) for the three possible levels of market demand. Market Demands Alternative Low Medium High Lease New Equipment -0.5 2 4 Purchase New Equipment -3 0.5 6 Add Third Shift 0.5 0.75 1 Do Nothing 0 0 0 If Trey uses the maximax criterion, the appropriate alternative would be: _____________. a) Lease New Equipment b) Purchase New Equipment c) Add Third Shift d) Do Nothing e) Do everything

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 The opportunity loss for the combination "S3" and "d1" is ________. a) 9 b) 5 c) 3 d) 0 e) -1

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 The opportunity loss for the combination "S2" and "d1" is ________. a) 9 b) 5 c) 3 d) 0 e) -1

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 Using the Hurwicz criterion with alpha = 0.1, the appropriate choice would be ________. a) d1 b) d2 c) d3 d) d4 e) d5

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 Using the Hurwicz criterion with alpha = 0.2, the appropriate choice would be ________. a) d1 b) d2 c) d3 d) d4 e) d5

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 Using the maximin criterion, the appropriate choice would be __________. a) d1 b) d2 c) d3 d) d4 e) d5

**Q:**Consider the following decision table with rewards in $ millions. State of Nature Decision Alternatives S1 S2 S3 d1 -1 2 8 d2 -3 7 5 d3 -0.5 0.75 1 d4 0 0 0 d5 -1 -1 -1 Using the maximax criterion, the appropriate choice would be __________. a) d1 b) d2 c) d3 d) d4 e) d5

**Q:**Dan Hein owns the mineral and drilling rights to a 1,000 acre tract of land. If he drills a well and does not strike oil his net loss will be $50,000, but if he drills a well and strikes oil his net gain will be $100,000. If he does not drill, his loss is the cost of the mineral and drilling rights, which amount to $1000. The probability of the state of nature "oil in the tract" is unknown. If Dan is a pessimist, he would choose the ____________. a) maximin criterion b) maximax criterion c) Hurwicz criterion d) minimax regret strategy e) maximin regret strategy

**Q:**Dan Hein owns the mineral and drilling rights to a 1,000 acre tract of land. If he drills a well and does not strike oil his net loss will be $50,000, but if he drills a well and strikes oil his net gain will be $100,000. If he does not drill, his loss is the cost of the mineral and drilling rights, which amount to $1000. The probability of the state of nature "oil in the tract" is unknown. If Dan is an optimist, he would choose the _____________. a) maximin criterion b) maximax criterion c) Hurwicz criterion d) minimax regret strategy e) maximin regret strategy

**Q:**Dan Hein owns the mineral and drilling rights to a 1,000 acre tract of land. If he drills a well and does not strike oil his net loss will be $50,000, but if he drills a well and strikes oil his net gain will be $100,000. If he does not drill, his loss is the cost of the mineral and drilling rights, which amount to $1000. For Dan's decision problem, the variable "oil in the tract" is one of the ___________. a) payoffs b) decision alternatives c) states of nature d) revised probabilities e) prior probabilities

**Q:**Dan Hein owns the mineral and drilling rights to a 1,000 acre tract of land. If he drills a well and does not strike oil his net loss will be $50,000, but if he drills a well and strikes oil his net gain will be $100,000. If he does not drill, his loss is the cost of the mineral and drilling rights, which amount to $1000. For Dan's decision problem, the variable "net loss of $50,000" is one of the ___________. a) payoffs b) decision alternatives c) states of nature d) revised probabilities e) prior probabilities

**Q:**Dan Hein owns the mineral and drilling rights to a 1,000 acre tract of land. If he drills a well and does not strike oil his net loss will be $50,000, but if he drills a well and strikes oil his net gain will be $100,000. If he does not drill, his loss is the cost of the mineral and drilling rights, which amount to $1000. For Dan's decision problem, the variable "drill the well" is one of the ___________. a) payoffs b) decision alternatives c) states of nature d) revised probabilities e) prior probabilities

**Q:**In decision-making under uncertainty, the approach that considers only the best and the worst payoffs for each decision alternative is the __________. a) maximin criterion b) maximax criterion c) Hurwicz criterion d) minimax regret strategy e) maximin regret strategy

**Q:**In decision-making under uncertainty, a pessimistic approach is the __________. a) maximin criterion b) maximax criterion c) Hurwicz criterion d) minimax regret strategy e) maximin regret strategy

**Q:**In decision-making under uncertainty, an optimistic approach is the __________. a) maximin criterion b) maximax criterion c) Hurwicz criterion d) minimax regret strategy e) maximin regret strategy

**Q:**Dianna Ivy is evaluating a plan to expand the production facilities of International Compressors Company which manufactures natural gas compressors. Dianna feels that the price of coal is a significant factor in her decision, but she cannot control it. For her decision, the different prices of coal represent the _____________. a) payoffs b) decision alternatives c) states of nature d) revised probabilities e) prior probabilities

**Q:**In a decision analysis problem, variables (such as investing in common stocks or corporate bonds) which are under the decision maker's control are called _________. a) payoffs b) decision alternatives c) states of nature d) revised probabilities e) prior probabilities

**Q:**The value of sample information is the difference between the expected monetary value with information to the expected monetary value without information.

**Q:**The value of sample information is the ratio of the expected monetary value with information to the expected monetary value without information.

**Q:**The concept of utility can be helpful to apply decision analysis techniques to situations which do not lend themselves to expected monetary value analysis.

**Q:**A risk-taker decision maker will bail out of risky scenario only if the compensation to bail out is more than the expected monetary payoff from the risky scenario.

**Q:**A risk-avoider decision maker will bail out of risky scenario only if the compensation to bail out is more than the expected monetary payoff from the risky scenario.

**Q:**The value of perfect information is the difference between the monetary payoff with perfect information and the expected monetary payoff with no information.

**Q:**The expected monetary payoff of perfect information is the value of perfect information.

**Q:**In decision-making under risk, the expected monetary payoff of perfect information is the weighted average of the best payoff for each state of nature (using the probability of the state of nature as the weight).

**Q:**In decision-making under risk, the expected monetary value without information is the largest of the expected monetary values for the various decision alternatives.

**Q:**In a decision-making under risk scenario, the expected monetary value of a decision alternative is the weighted average (using the probability of each state of nature as the weight) of the payoffs to the decision alternative in each state of the nature.

**Q:**In a decision-making under risk scenario, the expected monetary value of a decision alternative is the arithmetic average of the payoffs to the decision alternative in each state of the nature.

**Q:**In a decision-making scenario, if it is not known which of the states of nature will occur but the probabilities of occurrence of the states are known the scenario is called decision-making under risk.

**Q:**In a decision-making under uncertainty scenario using the strategy of minmax regret, all the entries in the opportunity loss table must be zero or positive.

**Q:**In a decision-making under uncertainty scenario, the best decision alternative based on the strategy of minmax regret will always have zero regret.

**Q:**In a decision-making under uncertainty scenario, the decision maker attempts to develop a strategy based on payoffs since virtually no information is available about which state of nature will occur.

**Q:**In a decision-making under uncertainty scenario, the decision maker chooses the decision alternative that has the minimum expected (i.e., probability-weighted) payoff among all the available alternatives.

**Q:**In a decision-making scenario, if it is not known which of the states of nature will occur and further if the probabilities of occurrence of the states are also unknown the scenario is called decision-making under double risk.

**Q:**In a decision-making scenario, if the decision maker knows which state of nature will occur, the scenario is called decision-making under certainty.

**Q:**In a decision analysis problem, variables (such as benefits or rewards that result from investments in common stocks or corporate bonds and from a new product launch) which result from selecting a particular decision alternative are called posterior probabilities.

**Q:**In a decision analysis problem, variables (such as investing in common stocks or corporate bonds) which are under the decision maker's control are called decision alternatives.

**Q:**In a decision analysis problem, variables (such as general macroeconomic conditions) which are not under the decision maker's control are called prior probabilities.

**Q:**A particular electronic component is produced at two plants for an electronics manufacturer. Plant A produces 70% of the components used and the remainder are produced by plant B. The probability that a component is defective is 0.02 if it is produced at plant A and 0.01 if it is produced at plant B. If the component is defective the revised probability it is produced at plant B, P (B|D), is ________ a) 0.3 b) 0.01 c) 0.003 d) 0.176 e) 0.017

**Q:**A particular electronic component is produced at two plants for an electronics manufacturer. Plant A produces 70% of the components used and the remainder are produced by plant B. The probability that a component is defective is 0.02 if it is produced at plant A and 0.01 if it is produced at plant B. The probability that the component is defective is ______ a) 0.3 b) 0.01 c) 0.003 d) 0.176 e) 0.017

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7The EMV of this investment opportunity with the advisor's prediction is ________.a) $167,379b) $174,200c) $153,900d) $136,700e) $140,011

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bear market the EMV of the Stocks alternative, using revised probabilities, is ________.a) $132,300b) -$73,900c) $127,600d) -$99,800e) $100,000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bear market the EMV of the Bonds alternative, using revised probabilities, is ________.a) $36,600b) $24,600c) $56,800d) $48,200e) $45,800

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bull market the EMV of the Stocks alternative, using revised probabilities, is ________.a) $168,900b) $207,650c) $157,300d) $306,000e) $134,650

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bull market the EMV of the Bonds alternative, using revised probabilities, is ________.a) $85,240b) $25,710c) $108,450d) $75,480

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bear market the revised probability of a Bear market, P (S2|F2), is ________.a) 0.524b) 0.636c) 0.784d) 0.812e) 0.000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7If the advisor predicts a Bull market the revised probability of a Bull market, P (S1|F1), is ________.a) 0.877b) 0.894c) 0.953d) 0.923e) 1.000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets.Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7The probability that the advisor predicts a Bull market, P (F1), is ________.a) 0.78b) 0.894c) 0.953d) 0.923e) 1.000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified two alternatives and constructed the following tables which show (1) expected profits (in $10,000's) for various market conditions and their probabilities, and (2) the advisor's track record on predicting Bull and Bear markets. Market ConditionInvestmentBull (0.8)Bear (0.2)EMVBonds12-39Stocks25-3014 Actual Market ConditionAdvisor'sPredictionBull (S1)Bear (S2)Bull (F1)0.90.3Bear (F2)0.10.7The probability that the advisor predicts a Bull market and the Bull market is the actual condition p(F1–S1) is ________.a) 0.78b) 0.9c) 0.953d) 0.923e) 0.72

**Q:**Frank Forgione has the right to enter a contest where he has a 50% chance of winning $50,000 and a 50% chance of losing $0. It costs Frank nothing to enter the contest. If he is willing to give up his right to enter the contest for a sure payment of $25,000, he is ___. a) a risk avoider b) an optimist c) a risk taker d) risk neutral (an EMV'er) e) a gambler

**Q:**Frank Forgione has the right to enter a contest where he has a 50% chance of winning $50,000 and a 50% chance of losing $0. It costs Frank nothing to enter the contest. If he is willing to give up his right to enter the contest for a sure payment of $10,000, he is ___. a) a risk avoider b) an optimist c) a risk taker d) risk neutral (an EMV'er) e) a gambler

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 The expected value of perfect information is ________. a) $57,000 b) $63,000 c) $79,000 d) $82,000 e) $87,000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 The expected monetary payoff with perfect information is ________. a) $128,000 b) $137,000 c) $144,000 d) $151,000 e) $127,000

**Q:**Melissa Rossi, Product Manager at National Consumers, Inc. (NCI), is evaluating alternatives for introducing a new package for toothpaste. She has identified four alternative markets, and has constructed the following table which shows NCI's rewards (in $1,000,000's) for various levels of acceptance by the markets and their probabilities. Market Acceptance Market Low (.3) Medium (.4) High (.3) Northeast Only -0.7 0 1 Southeast Only -0.2 0.2 0.8 National -1.5 -0.2 2 None (don't introduce the new package) 0 0 0 The expected value of perfect information is ________. a) $420,000 b) $570,000 c) $660,000 d) $720,000 e) $890,000

**Q:**Melissa Rossi, Product Manager at National Consumers, Inc. (NCI), is evaluating alternatives for introducing a new package for toothpaste. She has identified four alternative markets, and has constructed the following table which shows NCI's rewards (in $1,000,000's) for various levels of acceptance by the markets and their probabilities. Market Acceptance Market Low (.3) Medium (.4) High (.3) Northeast Only -0.7 0 1 Southeast Only -0.2 0.2 0.8 National -1.5 -0.2 2 None (don't introduce the new package) 0 0 0 The expected monetary payoff with perfect information is ________. a) $570,000 b) $680,000 c) $760,000 d) $830,000 e) $980,000

**Q:**The expected monetary value without information is $60, and the expected monetary payoff with perfect information is $120. The expected value of perfect information is __. a) $60 b) $2 c) $180 d) $0.50 e) $120

**Q:**The expected monetary value without information is $2,500, and the expected monetary payoff with perfect information is $5,000. The expected value of perfect information is ____________. a) $7,500 b) $2,500 c) $1,500 d) $2,000 e) $1,250

**Q:**In decision-making under risk, the expected monetary value without information is ____________. a) the weighted average of the best payoff for each state of nature b) the largest of the EMVs for the different decision alternatives c) never smaller than the expected monetary payoff with perfect information d) the average of the EMVs e) half the expected monetary value with information

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 The EMV of investing in Mixture is ________. a) $30,000 b) $63,000 c) $78,000 d) $81,000 e) $100,000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 The EMV of investing in Bonds is ________. a) $30,000 b) $63,000 c) $78,000 d) $81,000 e) $100,000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 The EMV of investing in Stocks is ________. a) $30,000 b) $63,000 c) $78,000 d) $81,000 e) $100,000

**Q:**Ray Crofford is evaluating investment alternatives for the $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following table which shows expected profits (in $10,000's) for various market conditions and their probabilities. Market Condition Investment Bull (.5) Neutral (.3) Bear (.2) T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the EMV criterion, the appropriate choice is ________. a) T-Bills b) Stocks c) Bonds d) Mixture e) Bank CD's

**Q:**Melissa Rossi, Product Manager at National Consumers, Inc. (NCI), is evaluating alternatives for introducing a new package for toothpaste. She has identified four alternative markets, and has constructed the following table which shows NCI's rewards (in $1,000,000's) for various levels of acceptance by the markets and their probabilities.Market AcceptanceMarketLow (.3)Medium (.4)High (.3)Northeast Only-0.701Southeast Only-0.20.20.8National-1.5-0.22None (don't introduce the new package)000The EMV of introducing the new package in the "National" market is ________.a) $50,000b) $70,000c) $90,000d) $260,000e) $300,000

**Q:**Melissa Rossi, Product Manager at National Consumers, Inc. (NCI), is evaluating alternatives for introducing a new package for toothpaste. She has identified four alternative markets, and has constructed the following table which shows NCI's rewards (in $1,000,000's) for various levels of acceptance by the markets and their probabilities.Market AcceptanceMarketLow (.3)Medium (.4)High (.3)Northeast Only-0.701Southeast Only-0.20.20.8National-1.5-0.22None (don't introduce the new package)000The EMV of introducing the new package in the "Northeast Only" market is ________.a) $50,000b) $70,000c) $90,000d) $260,000e) $300,000

**Q:**Melissa Rossi, Product Manager at National Consumers, Inc. (NCI), is evaluating alternatives for introducing a new package for toothpaste. She has identified four alternative markets, and has constructed the following table which shows NCI's rewards (in $1,000,000's) for various levels of acceptance by the markets and their probabilities.Market AcceptanceMarketLow (.3)Medium (.4)High (.3)Northeast Only-0.701Southeast Only-0.20.20.8National-1.5-0.22None (don't introduce the new package)000If Melissa uses the EMV criterion, the appropriate choice would be: ________.a) Northeast Onlyb) Southeast Onlyc) Nationald) None (don't introduce the new package)

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 For the 'Stocks' and 'Bonds' choices, the indifference value of Hurwicz's alpha is ____. a) 0.82 b) 0.71 c) 0.65 d) 0.33 e) 0.50

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 For the 'T-Bills' and 'Bonds' choices, the indifference value of Hurwicz's alpha is _____. a) 0.8267 b) 0.7134 c) 0.6555 d) 0.3333 e) 0.5000

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 For the combination of 'Bear' and 'Mixture', the opportunity loss is ______. a) 0 b) 5 c) 13 d) 33 e) -10

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 For the combination of 'T-Bills' and 'Neutral', the opportunity loss is _________. a) 0 b) 5 c) 7 d) 8 e) -10

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the Hurwicz criterion with alpha = 0.9, the appropriate choice is ______. a) T-Bills b) Stocks c) Bonds d) Mixture e) None

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the Hurwicz criterion with alpha = 0.5, the appropriate choice is ______. a) T-Bills b) Stocks c) Bonds d) Mixture e) None

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the Hurwicz criterion with alpha = 0.1, the appropriate choice is ______. a) T-Bills b) Stocks c) Bonds d) Mixture e) None

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the maximin criterion, the appropriate choice would be ________. a) T-Bills b) Stocks c) Bonds d) Mixture e) None

**Q:**Ray Crofford is evaluating investment alternatives to invest $100,000 which he inherited from his grandfather. His investment advisor has identified four alternatives and constructed the following payoff table which shows expected profits (in $10,000's) for various market conditions. Market Condition Investment Bull Neutral Bear T-Bills 3 3 3 Stocks 21 11 -30 Bonds 15 4 -3 Mixture 13 6 -10 If Ray uses the maximax criterion, the appropriate choice would be ________. a) T-Bills b) Stocks c) Bonds d) Mixture e) None

**Q:**You are conducting a study on the blood glucose levels of 9 patients who are on strict diets and exercise routines. To monitor the mean and range of the blood glucose levels of your patients, you take a blood glucose reading every day for each patient for 20 days. The mean of the 9 sample means is 101.03, and the mean of the 9 standard deviations is 29.243. The lower control limit for your chart is ________.a) 70.85b) 92.11c) 73d) 71.75e) 60.5

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