Pls help with below homework. Select the correct option and explain it in 7-8 sentences. An engineer decided to make a careful analyss of the cost of fre insurance for a $100,000 home Considenng the followng decision troe, what probability makes the two options favdoquivalent expected values? Cost values are shown in the decision treo-$800Option 1: Buy insuranceDecision:Buyinsurance?No fire loss$0Fire loss?Fire loss-$100,000p=?O A.0 006OB0 005OC O 007

Probability is the part of science concerning mathematical depictions of how logical an occasion is…

Answered: Option 1: Buy insurance Decision: Buy…

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Option 1: Buy insurance Decision: Buy insurance? No fire loss $0 Fire loss? Fire loss -$100,000 p=2 OA0 006 OR0.005

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Pls help with below homework. Select the correct option and explain it in 7-8 sentences.

An engineer decided to make a careful analyss of the cost of fre insurance for a $100,000 home Considenng the followng decision troe, what probability makes the two options favd
oquivalent expected values? Cost values are shown in the decision treo
-$800
Option 1: Buy insurance
Decision:
Buy
insurance?
No fire loss
$0
Fire loss?
Fire loss
-$100,000
p=?
O A.0 006
OB0 005
OC O 007

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