A First Course in Probability (10th Edition)
10th Edition
ISBN: 9780134753119
Author: Sheldon Ross
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Related questions
Question
Transcribed Image Text:A venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first
investment, a software company, has a 5% chance of returning $5,000,000 profit, a 20% chance of returning
$500,000 profit, and a 75% chance of losing the million dollars. The second company, a hardware company,
has a 6% chance of returning $4,000,000 profit, a 28% chance of returning $2,500,000 profit, and a 66%
chance of losing the million dollars. The third company, a biotech firm, has a 15% chance of returning
$6,000,000 profit, a 32% of no profit or loss, and a 53% chance of losing the million dollars.
Order the expected values from smallest to largest.
second, third, first
first, third, second
second, first, third
third, first, second
third, second, first
O first, second, third
Expert Solution
arrow_forward
Step 1
Given:
the data given for 3 investments are as shown below
Investment first
| Profit | Probability |
| 5000000 | 0.05 |
| 500000 | 0.2 |
| -1000000 | 0.75 |
Investment second
| Profit | Probability |
| 4000000 | 0.06 |
| 2500000 | 0.28 |
| -1000000 | 0.66 |
Investment third
| Profit | Probability |
| 6000000 | 0.15 |
| 0 | 0.32 |
| -1000000 | 0.53 |
Trending nowThis is a popular solution!
Step by stepSolved in 2 steps
Knowledge Booster
Similar questions
- A venture capitalist, willing to invest $1,000,000 has three investments to choose from. The first investment, a software company, has a 10% chance of returning $5,000,000profit, a 30% chance of returning $1,000,000 profit, and a 60% chance of losing the million dollars. The second company, a hardware company, has a 20%chance of returning $3,000,000 profit, a 40% chance of returning $1,000,000profit, and a 40%chance of losing the million dollars. The third company, a biotech firm, has a 10% chance of returning $6,000,000 profit, a 70%of no profit or loss, and a 20% chance of losing the million dollars. (a) Construct a PDF for each investment.Enter the exact answers as fractions or decimals. x P(x) −1,000,000 1,000,000 5,000,000 software company^ x P(x) −1,000,000 1,000,000 3,000,000 hardware company^ x P(x) −1,000,000 0 6,000,000 Biotech firm (b) Find the expected value for each investment. Software company: $Hardware…arrow_forwardA venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first investment, a software company, has a 11% chance of returning $5,000,000 profit, a 29% chance of returning $1,500,000 profit, and a 60% chance of losing the million dollars. The second company, a hardware company, has a 12% chance of returning $5,000,000 profit, a 28% chance of returning $3,500,000 profit, and a 60% chance of losing the million dollars. The third company, a biotech firm, has a 14% chance of returning $10,000,000 profit, a 33% of no profit or loss, and a 53% chance of losing the million dollars. Order the expected values from smallest to largest. third, first, second second, third, first first, second, third third, second, first second, first, third first, third, secondarrow_forwardComplete the following probability distribution table: Probability Distribution Table P(X) 0.3 16 24 0.2 34 0.3 Submit Questionarrow_forward
- A venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first investment, a software company, has a 13% chance of returning $6,000,000 profit, a 20% chance of returning $3,000,000 profit, and a 67% chance of losing the million dollars. The second company, a hardware company, has a 14% chance of returning $6,000,000 profit, a 30% chance of returning $1,500,000 profit, and a 56% chance of losing the million dollars. The third company, a biotech firm, has a 10% chance of returning $7,000,000 profit, a 41% of no profit or loss, and a 49% chance of losing the million dollars.Order the expected values from smallest to largest. first, third, second second, third, first third, second, first first, second, third second, first, third third, first, secondarrow_forwardA venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first investment, a software company, has a 13% chance of returning $11,000,000 profit, a 25% chance of returning $2,000,000 profit, and a 62% chance of losing the million dollars. The second company, a hardware company, has a 14% chance of returning $6,000,000 profit, a 39% chance of returning $3,000,000 profit, and a 47% chance of losing the million dollars. The third company, a biotech firm, has a 7% chance of returning $6,000,000 profit, a 40% of no profit or loss, and a 53% chance of losing the million dollars.Order the expected values from smallest to largest. third, first, second third, second, first first, second, third first, third, second second, third, first second, first, thirdarrow_forwardYou are the marketing director for a company that manufactures bodybuilding supplements, and you are planning to run ads in Sports Illustrated and GQ Magazine. On the basis of readership data, you estimate that each ad in Sports Illustrated will be read by 600,000 people in your target group, while each ad in GQ will be read by 150,000. You would like your ads to be read by at least 12 million people in the target group, and you plan to place at least 6 ads in Sports Illustrated and at least 8 ads in GQ during the next year. Sports Illustrated quotes you $2000 per ad, while GQ quotes you $1000 per ad. How many ads should be placed in each magazine to satisfy your requirements at a minimum cost? Sports Illustrated ads GQ Magazine adsarrow_forward
- Three competing brands of cerial are being sold in the school cafeteria. Brand z's weekly sales are affected by the sales of the other two proucts. For each $1 increase in brand æ's sales, there is a decrease $0.80 in sales of brand z. Similarly, each $1 increase in brand y's sales, there is a increase $0.10 in sales of brand z. If the current sales for brand z, y, and z are $45.00, $69.00, and $76.00 respectively, write an equation for z's sales in terms of a and y.arrow_forwardA venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first investment, a software company, has a 14% chance of returning $8,000,000 profit, a 19% chance of returning $1,500,000 profit, and a 67% chance of losing the million dollars. The second company, a hardware company, has a 15% chance of returning $9,000,000 profit, a 37% chance of returning $3,500,000 profit, and a 48% chance of losing the million dollars. The third company, a biotech firm, has a 15% chance of returning $6,000,000 profit, a 28% of no profit or loss, and a 57% chance of losing the million dollars.Order the expected values from smallest to largest. first, third, second third, first, second third, second, first second, first, third first, second, third second, third, firstarrow_forwardA venture capitalist, willing to invest $1,000,000, has three investments to choose from. The first investment, a software company, has a 13% chance of returning $4,000,000 profit, a 30% chance of returning $1,500,000 profit, and a 57% chance of losing the million dollars. The second company, a hardware company, has a 14% chance of returning $4,000,000 profit, a 41% chance of returning $1,500,000 profit, and a 45% chance of losing the million dollars. The third company, a biotech firm, has a 5% chance of returning $9,000,000 profit, a 32% of no profit or loss, and a 63% chance of losing the million dollars.Order the expected values from smallest to largest.arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
- A First Course in Probability (10th Edition)ProbabilityISBN:9780134753119Author:Sheldon RossPublisher:PEARSON
A First Course in Probability (10th Edition)
Probability
ISBN:9780134753119
Author:Sheldon Ross
Publisher:PEARSON