Assume you can invest in 2 projects whose payoff depend on the state of the economy. The profits from each project for each state of the economy are presented below. What are the expected payoffs of each project if there is a 30% chance of a recession and a 70% of no recession? Profit under recession Profit under normal conditions Project 1 100,000 150,000 Project 2 50,000 240,000 O Project 1: $130,000 and Project 2: $180,000 O Project 1: $135,000 and Project 2: $183,000 O Project 1: $135,000 and Project 2: $180,000 O Project 1: $130,000 and Project 2: $183,000

Assume you can invest in 2 projects whose payoff depend on the state of the economy. The profits from each project for each state of the economy are presented below. What are the expected payoffs of each project if there is a 30% chance of a recession and a 70% of no recession? Profit under recession Profit under normal conditions Project 1 100,000 150,000 Project 2 50,000 240,000 O Project 1: $130,000 and Project 2: $180,000 O Project 1: $135,000 and Project 2: $183,000 O Project 1: $135,000 and Project 2: $180,000 O Project 1: $130,000 and Project 2: $183,000

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter5: Business And Economic Forecasting

Section: Chapter Questions

Problem 2E

See similar textbooks

Similar questions

S InPrivate O Unit 11 - Textbook and Min MindTap - Cengage Lea X O 10090Monopoly Outcome8 -> A https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentld=56736610685718221329898682&elSBN=9781337096577&snapshotld=1556207&id3692! O * ... 2 Shay v CENGAGE MINDTAP Q Search this course MAIN MENU ECO201 Homework (Ch 15) * My Home Now, suppose that Barefeet can practice perfect price discrimination-that is, it knows each consumer's willingness to pay for each pair of Ooh boots Courses and is able to charge each consumer that amount. A-Z CENGAGE UNLIMITED On the following graph, use the black point (plus symbol) to indicate the profit-maximizing quantity sold and the lowest price at which the firm sells its O Browse Catalog boots. Next, use the purple points (diamond symbol) to shade the profit, the green points (triangle symbol) to shade the consumer surplus, and the black points (plus symbol) to shade the deadweight loss in this market with perfect price discrimination. (Note: If you…
Upgrading an Organization’s ComputersYour organization earns $50 million in annual sales, has 500 employees, andplans to acquire 250 new mobile computers this year along with another 250next year. The goal is to issue every employee a company-owned computer,which they can use at work and at home. The computers will be loaded withantivirus software and productivity software to meet each employee’s business needs. Your organization has decided it will purchase the computersfrom the same manufacturer to obtain a quantity purchase discount. To theextent possible, the goal is to have the same hardware and software foreveryone to simplify the troubleshooting and support of the computers. Thechief financial officer has asked you to lead a project team to define users’computer hardware needs and recommend the most cost-effective solutionfor meeting those needs. Critical Thinking Questions1. Who else (role, department) and how many people would you select to bea member of the team? How would…
S InPrivate O Unit 11 - Textbook and Min MindTap - Cengage Lea x D 10090Monopoly Outcome8 -> A https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentld=56736610685718221329898682&elSBN=9781337096577&snapshotld=1556207&id3692! O * ... 2 Shay v * CENGAGE MINDTAP Q Search this course MAIN MENU ECO201 Homework (Ch 15) boots. For simplicity, assume that fixed costs are equal to zero; this, combined with the fact that Barefeet's marginal cost is constant, means that its * My Home marginal cost curve is also equal to the average total cost (ATC) curve. Courses First, suppose that Barefeet cannot price discriminate. That is, it must charge each consumer the same price for Ooh boots regardless of the A-Z consumer's willingness and ability to pay. CENGAGE UNLIMITED O Browse Catalog On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity. Next, use the purple points (diamond symbol) to shade the profit, the green points (triangle…
start_frame auto.d21?ou=1492871&isprv=&drc%=0&qi=/ Casey Rosenberg: Attempt 1 Graph (a) Graph (b) NCO Demand Supply NET CAPITAL OUTFLOW QUANTITY OF LOANABLE FUNDS Graph (c) Supply MacBook Air DII F12 F10 F11 F9 80 F7 F8 F6 F5 F4 F3 23 24 7 8. 4 Y U P D G J. K AL EXCHANGE RATE REAL INTEREST RATE
A Question Completion Status: 20 3 4 8. 10 11 12 13 14 15 16 17 18 26 27 28 29 30 31 32 33 34 19 20 35 A Moving to the next question prevents changes to this answer. estion 3 A budgeted income statement is a projection showing how a firm's budgeted sales and costs will affect expected net incc True False > A Moving to the next question prevents changes to this answer. MacBook Air
A Questions and Answers-2021.pd x Questions and Answers-2021 (3) X O File | C:/Users/18326/Downloads/Questions%20and%20Answers-2021%20(3).pdf + D Page view A 3 of 17 | Q-1 PARC Co., has asked you to recommend a new nutcracker machine. After months of hard re- search, you have collected the following data: Data KRAX SPLIT-NUT Life, Years First Cost (FC) Benefit, Yearly (AB) Gradient (AB G) M&O Gradient (M&OG) M&O Cost (M&O) Salvage Value Discussions with the accounting department reveal that a loan must be secured to purchase any machine. The loan data is as follows: Data $202,000.00 $285,000.00 73,000.00 1,200.00 88,000.00 1,300.00 1,100.00 34,000.00 48,000.00 600.00 18,000.00 42,000.00 KRAX SPLIT-NUT Down Payment (% of FC) Loan Period, Years Loan Payment The loan payments will be made annually. The lender will charge 12% interest with annual com- pounding. Calculate the Net Present Worth of each machine and recommend which machine to purchase. Use a MARR of 15%. 30% 30% $34,392.11…
Describe how you might address the uncertainty associated with the projectProblems?
NPV Calculate the net present value (NPV) for the following 12-year projects. on the acceptability of each. Assume that the firm has a cost of capital of 7%. a. Initial investment is $1,000,000; cash inflows are $ 160,000 per Year b. Initial investment is $2,500,000; cash inflows are $320,000 per Year Using Excel to answer. Show all Formulas
What process does the net present value method use to help management determine whether a project is acceptable to a company? Options : A. It discounts net cash flows to their present value and then compares that value to the capital outlay required by the project.B. It determines the interest rate that will cause the present value of the capital expenditure to equal the present value of the expected net cash flows.C. It divides the present value of net cash flows by the initial investment to determine the profitability index of the project.D. It identifies the time period required to recover the cost of the capital investment from the net annual cash flow produced by the project.
A department store is about to order deluxe, standard, and economy grade DVD players for next year's inventory. The state of the nation's economy (fate) during the year will be a factor on sales for that year. Records over the past 5 years show that if the economy is up, the store will net 4, 3, and 1 million dollars, respectively, on sales of deluxe, standard, and economy grade models; if the economy is down, the company will net – 1, 0, and 3 million dollars, respectively, on sales of deluxe, standard, and economy grade models. Complete parts A through D below. ... (A) Set up a payoff matrix for this problem. Economy (fate) Up Down Deluxe Dept. Store Standard Economy
- 16 (10%) (page 2 of 3)- Google Chrome urses.open.uwi.edu/mod/quiz/attempt.php?attempt3D43724&cmid3D461748&page=D1 Exchange 2020 12015 Mathematical Methods of Economics I | S2 20 Ensure that you show ALL workings. Graphs NOT required. n tyn- A company produces two types of can openers: Model I and Model 2. Each require the use of three machines: A, B and C. Model I requires 2 hours on machine A, 1 hour on machine B and 1 hour on machine C. Model II requires 1 hour on machine A, 2 hours on machine B and 1 hour on machine C.The maximum number of hours available for machine A, B and C are 180, 160 and 100 respectively. The profit on Model I is $4 and Model Il is $6. on Write down the LP model. Identify the coordinates of the extreme points of the feasible region. Paragraph -BIEE W 99+
Figure 2 shows the payments and revenues of a small project. If M.R.R.R= %12, Evaluate the project economically using A.W method $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $2,500 $500 0 $20,000 2 $1,000 ترا $1,500 $2,000 $2,500 $3,000 $3,90gure 2