Consider the following payoff Table Decision Alternative D₁ D₂ The State of Nature 0.77 1-0.77 $1 52 3 8 9 3 D3 12 5 What is the payoff value for the D2 under $2 should be to keep the optimal solution always optimal? Do not writ the sign> or <) (Round your answer to 2 decimal places)

Consider the following payoff Table Decision Alternative D₁ D₂ The State of Nature 0.77 1-0.77 $1 52 3 8 9 3 D3 12 5 What is the payoff value for the D2 under $2 should be to keep the optimal solution always optimal? Do not writ the sign> or <) (Round your answer to 2 decimal places)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

Consider the following payoff Table
Decision Alternative
D₁
The State of Nature
0.77
1-0.77
$1
$2
3
8
9
D₂
3
D3
12
5
What is the payoff value for the D2 under $2 should be to keep the optimal solution always optimal? Do
not writ the sign > or <)
(Round your answer to 2 decimal places)

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