e 25-20. Given the following payoff matrix :Payoff (in Rs.)State of NatureActCold WeatherHot WeatherSell Cold Drinks50100Sell Hot Drinks12040and given the probability of weather being hot is 0-8, set up the opportunity loss table and computeopportunity loss of each action. Select the best act.

Answered: Image /qna-images/answer/3df57e87-eb9e-4485-8285-b6978e9afb4b.jpg

Answered: e 25-20. Given the following payoff…

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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Suppose you have a report due in four weeks. You can choose to write this report in either week one, two, three or four. The reward v of finishing the report is consistent in the four weeks, i.e. Reward = (v, v, v, v). The cost c of finishing the report in each week is Cost = (3, 5, 8, 15). For %3D simplicity, we assume that 8 = 1. a. If you are time consistent (ß = 1), which week will you choose to write the report? b. If you are naïve (ß = 0.5), which week will you choose to write the report? %3D
Question 3 My friend, Ahmad, is trying to determine which of two opportunities he should invest in (only one of them). His options are Bitcoin and S&P 500. If he invests in Bitcoin, he believes that he has a 10% chance of making 15% profit, a 25% chance of only 8% profit, 15% of losing 10% of his investment capital (-10%), and a 50% chance of no change in his investment capital (0%). IH Ahmad invests in S6PS00, he has a 70% chance for the 8% profit, a 25% chance for no change (0%), 3% chance for losing -10%, and 2% for a 15% profit. Ahmad is indifferent between the following lotteries. 15% o and also indifferent between 15% and If Ahmad wants to invest in what maximizes his expected return on investment, which investment is the best? Please note: x-0.79 and y-0.06. In the box below put the expected utility for the investment he should pick. Write your answer with three decimals.
Class Exercise 2: Player I holds a black Ace and a red 8. Player II holds a red 2 and a black 7. The players simultaneously choose a card to play. If the chosen cards are of the same color, Player I wins. Player II wins if the cards are of different colors. The amount won is a number of rands equal to the number on the winner's card (Ace counts as 1.) Set up the payoff function.
Given P(E) = 0.91, what is P(E')?
1. ABC inc. stock is currently selling for $30, one year from today the stock price can either increase by 20% or decrease by 15%. The probability of an increase in the stock price is equal to 0.3. The one-year risk-free rate is 5% What is the value of a European put that expires in one year with an exercise price of $24. 2. Graphically, show the value and the profit and loss of the following butterfly position: Long in a call with an exercise price of $30, short in 2 calls with an exercise price of $45, and long in a call with an exercise price of 60. All calls are written on the same stock and have the same maturity. 3. "Early exercise of an American option on a stock that does not pay any dividend is not optimal regardless of whether the option is a Call or a Put". True, False, or Uncertain. Explain.
Cheryl is considering purchasing additional sewing machines to accommodate the increasing demand for her cosplay costumes. Her alternatives are to buy 1 machine, 2 machines, or 3 machines. The profits realized under each alternative are a function of whether her proposal to bid for clothing the official Bandai team is accepted or not. The payoff table below illustrates the profits realized (in $000's) based on the different scenarios Cheryl faces. The probability that her proposal will be accepted is 65%. Alternative Proposal Accepted Proposal Rejected Purchase 1 sewing machine $10 $5 Purchase 2 sewing machines $30 $4 Purchase 3 sewing machines $40 $2 What alternative should Cherly select if she is pessimistic? What alternative should Cherly select based on a criterion of realism with ?α = 0.8?
Investment A woman has $1,400,000 to purchasethree investments. One investment earns 8%, asecond earns 7.5%, and the third earns 10%.a. What investment strategies will give annual earnings of $120,000 from these three investments?b. What one investment strategy will minimize herrisk and return $120,000 if the 10% investmenthas the most risk?
Based on the graph rank the three economic variables listed below from most important to least important.Provide one relevant reason to justify your selection for each of the threepositions.
The Harriet Hotel in downtown Boston has 100 rooms that rent for $150 per night. It costs the hotel $30 per room in variable costs (cleaning, bathroom items, etc.) each night a room is occupied. For each reservation accepted, there is a 5% chance that the guest will not arrive. If the hotel overbooks, it costs $200 to compensate guests whose reservations cannot be honored. How many reservations should the hotel accept if it wants to maximize the average daily profit?
probability problem person 1 is trying to loss weight, he needs to consume less than 2000 calories per day to lose weight, anything more than 2000 calories per day he will gain weight. he eats the same thing every day which is 2500 calories. He will do one of four exercises each day running, swimming, or lifting. pull ups. He has 25% chance he will do any one of these. but he only can pick one per day. running will lose 1000 calories, swimming will lose 1000 calories, lifting will lose 1000 calories, pull ups only will lose 100 calories. only pull ups will not allow him to lose weight the day he does it. each day he has a 25% to pick any one of these exercises. after picking randomly one exercise per day for 10 days in a row what are the odds he will lose weight after 10 days?
H3.
ASAP PLEASE If your trading systerm has a losing percentage of 45%, how likely it is to have a series of four losses in a row? 1% 2.25% 45% 4.10%

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