answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
sesenic [268]
2 years ago
6

Erik is an investor with $5,000 available for investment. He has the following three investment possibilities from which to choo

se: Option Scenarios 1 Keep the $5,000 in cash for one year. 2 Invest in a friend’s business with a 50% chance of getting $10,000 after one year and a 50% chance of getting nothing. 3 Invest in a relative’s business with a 30% chance of getting $15,000 after one year, 20% chance of getting $2,500 after one year, 50% chance of getting nothing. If Erik is indifferent about these three investment options, and he thinks that they are worth the same to him. Therefore, which of the following statements is true about Erik? He is risk-neutral. He is risk-averse. He is risk-loving. None of these descriptions is accurate. Later, while examining the same investment alternatives, Erik’s brother, Devin, clearly expressed a preference for option 1. Which of the following statements is true about Devin? He is risk-averse. He is risk-neutral. He is risk-loving. None of the above.
Business
1 answer:
Elanso [62]2 years ago
5 0

Answer: None of these descriptions is accurate for Erik as he does not care about the level of risk involved and is indifferent to all the investment options and their risks.

Devin is risk averse as he decides to choose the safest option which is keeping the money as cash for one year.

Explanation:

You might be interested in
Which statement best describes one way businesses participate in the
likoan [24]

Answer:

C. Businesses create goods for product markets to sell.

Explanation:

8 0
2 years ago
Read 2 more answers
Blue Ice Inc. is an American corporation. The company started out as a 1. ____ between Nick Selver and Rita Andrew in 1985. In 2
Andrei [34K]
1) Partnership. Nick Selver and Rita Andrew began the company as a partnership. 
2) partners: This word best describes the interest-holding people in a partnership
3) Incorporate: This word best describes converting the partnership to a corporation in order to democratize ownership of the company and sell stock publicly
4) Stock Market: This is the market in which shares of a public company are traded on the open market. 
6 0
2 years ago
Suppose Maria prefers to buy a bond with a​ 7% expected return and​ 2% standard deviation of its expected​ return, while Jennife
zepelin [54]

Answer: The correct answer is "A.Maria is less​ risk-averse than Jennifer because Maria is choosing a bond with higher standard deviation.".

Explanation: We can measure the risk according to the standard deviation of its expected return, therefore: Maria is less risk averse because she is willing to take more risk in order to obtain a higher return and Jennifer instead prefers to sacrifice performance in order to be less exposed to risk.

7 0
2 years ago
Explain three steps an eighth grader should take to create a college savings plan if she is interested in attending a two-year j
vekshin1

first, the student should estimate the cost of attending a two-year program. Then she should plan to save part of that cost. Finally, she should determine how much to budget for periodic deposits.

3 0
2 years ago
Read 2 more answers
Business professionals value workplace relationships and professional behavior; therefore, it is vital to understand the charact
____ [38]

Answer: <em>Polish, Civility and Social Intelligence </em>

Explanation:

The following are the synonyms for the professional behavior: Civility, Polish and Social Intelligence. Social intelligence is referred to as or known as the capacity of an individual to know himself/herself and other individual.  Civility is referred or as known as the civilized conduct  i.e. considered to be a polite act or an expression .

6 0
2 years ago
Other questions:
  • The graphs below show the production possibilities frontiers for grapes and lemons in spain and argentina, with their current le
    6·1 answer
  • Which two of the four cs of credit have to do with earning potential and available cash?
    14·1 answer
  • During 2014, Raines Umbrella Corp. had sales of $750,000. Cost of goods sold, administrative and selling expenses, and depreciat
    13·1 answer
  • If labor demand is downward sloping and labor supply is upward sloping, then when labor demand rises faster than labor supply, i
    11·1 answer
  • Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $610,000 for servi
    11·2 answers
  • One use of inventory is A. to provide a hedge against inflation. B. to tightly synchronize production and distribution processes
    12·1 answer
  • The accountants hired by the Brookside Racquet Club have determined total fixed cost to be $75,000, total variable cost to be $1
    13·1 answer
  • Betty Cooker runs a bakery in San Francisco that specializes in her famous Black Forest cakes. These cakes come with four kinds
    14·1 answer
  • The following information was drawn from the accounting records of Chapin Company. On January 1, Year 1, Chapin paid $56,000 cas
    11·1 answer
  • Davis Florist has two employees, Anita and Jerome, and two tasks that need to be completed, floral arrangements and floral deliv
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!