QUESTION 19An investor is considering a $15,000 investment in a start-up company. She estimates that she has probability 0.15 of a $5,000 loss, probability 0.15of a $10,000 loss, probability 0.15 of a $50,000 profit, and probability 0.55 of breaking even (a profit of $0). What is the expected value of the profit?prbabiltyp Usethe binomialDo no bond intermedibte

Given that An investor considering a $15,000 investment in a start up company. She estimates that…

Answered: An investor is considering a $15,000…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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you are thinking of selling your house and you reckon that there is a 0.1 probability that you will sell it for $120 000, a 0.5 probability that you will receive $100 000 for it and a 0.4 probability that you will only receive $80 000. What is the expected selling price of the property? Interpret your result.
A company estimates that 0.7% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $400. If they offer a 2 year extended warranty for $27, what is the company's expected value of each warranty sold?
In looking over customer data for your local ice cream shop, you estimate the following probabilities about what customers order: P(vanilla) = 0.5 P(sundae) = 0.5 P(vanilla and sundae) = 0.1 What is the probability that a customer order vanilla ice cream given they ordered a sundae? Estimate your answer to the first decimal place.
A company estimates that 0.8% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $150. If they offer a 2 year extended warranty for $22, what is the company's expected value of each warranty sold?
A 30-year-old woman wants to purchase a $300,000 one-year life insurance policy. What should the insurance company charge the woman for the policy if it wants an expected profit of $60? The company should charge her $ Age 20 30 40 50 Probability of Female Death 0.00070 0.00080 0.00095 0.00305 C
Q17. A single share of a stock was purchased prior to the company's release of its quarterly report. There is a 58% chance that the company will meet the quarterly sales expectations for its new product two weeks from now, and the value of the stock will go to $440. Otherwise, the company will not meet the quarterly sales expectations, and the value of the stock will go down to $100. What is the expected value of the stock two weeks from now? (Round to the nearest dollar. Do not enter $ sign.)
A certain model phone costs $599. The probability of the phone breaking over the course of a year is .07. What is the maximum amount you could pay for phone replacement insurance and still have a non-negative expected value on the policy? In other words, for what price or below would it be worth it to get the insurance?
A company estimates that 0.7% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $50.If they offer a 2 year extended warranty for $4, what is the company's expected value of each warranty sold?
Q3
Kramer wants to open a fruit stand. He figures his business can be really successful, moderately successful, barely successful, a failure, or a complete failure. Below is a table of all the possible outcomes, the estimated probability that each outcome will occur, and the profit Kramer will make for each out. What is the expected profit, in thousands, for this business? (Round your answer to the nearest two decimal places. Do not include the dollar sign ($) in your answer.) Outcome Really successful Moderately successful Failure P() 0.1 2 0.2 Complete failure 0.3 Barely successful ³1 5 0.2 8 Quarterly Profit ($, thousands) 0.0 2 30 16 -5 -25
A company estimates that 0.6% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $250. If they offer a 2 year extended warranty for $39, what is the company's expected value of each warranty sold?
A company estimates that 0.6% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $400. If they offer a 2 year extended warranty for $42, what is the company's expected value of each warranty sold?

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