A property is owned by Tim, Jim, and Bim as joint tenants. What proportion of the property does Bim own? It depends on what they decided when they bought the property. Bim owns 50% of the property. Bim owns 25% of the property. Bim owns a 1/3 share of the property.
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- Wizard, a popular brand of electric garage door opener, includes two 40-watt bulbs that go onwhen the garage door is opened. A bulb will generally last about one year in normal operation.Three neighbors, James, Smith, and Walker, each has a Wizard opener in their respectivegarages. Each time a bulb burns out, James replaces both bulbs. Smith, on the other hand, replaces only the bulb that has burned out, and Walker replaces both bulbs only after both haveburned out. Assume that light bulbs fail according to an exponential law.b. What percentage of the time will Walker have only one bulb burning?of the applicants are denied on this basis? 5. a. What is the probability that a normal variable exceeds two-sigma limits? (That is, what is the probability of observing a value of the random variable larger than µ + 20 or less than µ – 20?)Emma can either buy a used car or buy a new car. The used car costs $12,800 with a 40% chance she will run into mechanical problems that will cost $3500 to repair. The new car costs $17,595. Also, there is an 8% chance she will get into an accident in the next 5 years, which will cost 20% of the value of her car. If the cost of the accident is greater than $5000 she would only pay a deductible of $3000. What is the expected value of buying a new car? What is the expected value of buying a used car? Draw a probability tree.
- Consider the following Bargaining game, where each player tries to maximize his own number of coins. Player A starts the game with 3 coins and Player B starts with 1 coin. Player A needs to decide how many coins to give to Player B. Player A moves first, and makes an offer to Player B. Player B observes the offer, and then chooses to accept or reject the offer. If player B rejects the offer, the game is over: Player A loses all his 3 coins and player B losses his 1 coin (both players end up with zero coins). If Player B accepts the offer, the game is over: Player B keeps his original 1 coin plus the coin(s) offered by Player A, while Player A keeps the coin(s) he did not offer to player B. In the subgame perfect equilibrium of this game: Select the right option from below Player A offers zero coins to Player B Player A offers one coin to Player B Player A offers two coins to Player B Player A offers three coins to Player B Player A plays a mixed…You are attempting to establish the utility that your boss assigns to a payoff of $1,200. You have established that the utility for a payoff of $0 is zero and the utility for a payoff of $10,000 is one. Your boss has just told you that they would be indifferent between a payoff of $1,200 and a lottery which has a payoff of $10,000 where the probability of losing is 0.9. What is your boss' utility for $1,200? (Round your answer to 1 decimal place.) Utility of $1,200At the beginning of each day, a patient in the hospital is classifed into one of the three conditions: good, fair or critical. At the beginning of the next day, the patient will either still be in the hospital and be in good, fair or critical condition or will be discharged in one of three conditions: improved, unimproved, or dead. The transistion probabilities for this situation are Good Fair Critical Good 0.65 0.20 0.05 Fair 0.50 0.30 0.12 Critical 0.51 0.25 0.20 Improved Unimproved Dead Good 0.06 0.03 0.01 Fair 0.03 0.02 0.03 Critical 0.01 0.01 0.02 For example a patient who begins the day in fair condition has a 12% chance of being in critical condition the next day and a 3%…
- In the trust game the responder (or trustee) can choose to send some money back to the proposer (also called the investor). Which of the following is true? The total gain in the game is higher with trust. The results show that most people are purely selfish. Typically, trustees get nothing from the investors. Trust almost always pays off.Consider a firm run by an “incumbent” manager. Suppose the incumbent manager has the opportunity to invest in one of two different projects, Project 1 or Project 2. The incumbent manager has a higher ability in managing Project 1 rather than Project 2. Also, if theincumbent is fired by shareholders, she is replaced by an “alternative” manager whose ability to manage Project 1 is lower than the incumbent’s ability. Suppose the investment in a project is irreversible, and the shareholders’ choice of the incumbent manager salary (as well as their decision on whether to fire her) is taken afterthe investment is made. Also, assume the incumbent manager has a stake in the firm she runs, but she does not fully control it. Questions:(a) Suppose none of the projects gives the manager a direct utility. According to Shleifer and Vishny (1989), which of the two projects should the incumbent manager choose? What is the economic rationale behind this choice? Explain. (b) Suppose the incumbent…Lorna owns a home that is worth $385,000. She has a mortgage with a balance of $112,000. Calculate her equity in the home. $497,000 $76,000 $273,000 $245,000
- Yoda just got a job offer. The job is located in Awayville. Awayville is 70 miles north of Binghamton. Yoda wants to accept the job offer, still live in Binghamton, and commute to Awayville on a daily basis. This will result in travel expense relates to approximately 700 miles per week. To make this plan work, Yoda needs a car that will get at least 25 miles per gallon of gasoline. Yoda goes to Darth's Used Car Dealership. Yoda tells Darth that Yoda needs a car that gets at least 25 miles per gallon of gasoline. Yoda explains the Awayville job situation and Darth says, "I understand - I will check my inventory - I will be right back." Darth goes into his office and looks through two different files of used car inventory. One file contains all cars that get over 25 miles per gallon of gasoline and the other file contains all cars that get under 25 miles per gallon of gasoline. Darth selects a used car from the file that indicates that the cars get over 25 miles per gallon of gasoline…Kara wants to build a business. She has plenty of capital and potential investors and partners. She wants to avoid the burden of sole liability for her business and wants to be able to close the business when she is no longer interested in it. Which of the following would lead Kara to choose a sole proprietorship organization for her business? Avoidance of sole liability Ability to close the business easily Many potential investors/partners Plenty of capitalA conflict of interest can occur when a decision maker’s personal interests interfere to the extent that he or she makes decisions that adversely affect customers or employees. True False