Exam 20: Decision Making Online

At Eastern University, 60% of the students are from suburban areas, 30% are from rural areas, and 10% are from urban areas.Of the students from the suburban areas, 60% are nonbusiness majors.Of the students from the rural areas, 70% are nonbusiness majors.Of the students from the urban areas, 90% are nonbusiness majors.If a randomly selected student is not a business major, the probability that the student is from the urban area is

For a potential investment of $5,000, a portfolio has an EMV of $1,000 and a standard deviation of $100.What is the rate of return?

SCENARIO 20-6 A student wanted to find out the optimal strategy to study for a Business Statistics exam with scores out of 100 possible points.He constructed the following payoff table based on the mean amount of time he needed to study every week for the course and the degree of difficulty of the exam.From the information that he gathered from students who had taken the course, he concluded that there was a 40% probability that the exam would be easy. -Referring to Scenario 20-6, the optimal strategy using the expected monetary value criterion is to study 16 hours per week on average for the exam.

SCENARIO 20-1 The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. where: -Referring to Scenario 20-1, if the probability of S1 is 0.5, what is the optimal alternative using EMV?

SCENARIO 20-3 The following information is from 2 investment opportunities. -Referring to Scenario 20-3, what is the coefficient of variation for investment A?

SCENARIO 20-5 The following payoff table shows profits associated with a set of 2 alternatives under 3 possible events. Suppose that the probability of Event 1 is 0.2, Event 2 is 0.5, and Event 3 is 0.3. -Referring to Scenario 20-5, what is the EOL for Action B?

SCENARIO 20-4 A stock portfolio has the following returns under the market conditions listed below. -Referring to Scenario 20-4, what is the EMV?

Blossom's Flowers purchases roses for sale for Valentine's Day.The roses are purchased for $10 a dozen and are sold for $20 a dozen.Any roses not sold on Valentine's Day can be sold for $5 per dozen.The owner will purchase 1 of 3 amounts of roses for Valentine's Day: 100, 200, or 400 dozen roses.Given 0.2, 0.4, and 0.4 are the probabilities for the sale of 100, 200, or 400 dozen roses, respectively, then the optimal alternative using EMV for selling roses is to buy dozen roses.

A company that manufactures designer jeans is contemplating whether to increase its advertising budget by $1 million for next year.If the expanded advertising campaign is successful, the company expects sales to increase by $1.6 million next year.If the advertising campaign fails, the company expects sales to increase by only $400,000 next year.If the advertising budget is not increased, the company expects sales to increase by $200,000.Identify the outcomes in this decision-making problem.