Adam and Jon Are the Only Players Playing in a Local

question 75

Multiple Choice

Adam and Jon are the only players playing in a local golf tournament.They can either practice for 5 hours or not practice at all.Practice has both direct monetary costs and opportunity costs.Their scores for an 18-hole round of golf with and without practice are shown in the table.Total prize money is $12,000.Two possible reward structures exist.In Plan A,the low score wins $10,000,second place wins $2000,and a tie results in $6000 each.Plan B requires a player to score 71,or less,for first place,72 to 80 is considered second place.The $10,000 will be split between those with a 71 or lower score,with a guaranteed minimum of $2000.The $2000 for second will be split between those with a score between 72 and 80.
-Refer to the information above.Plan A rewards

• A) absolute performance.
• B) excellent performance.
• C) relative performance.
• D) average performance.
• E) poor performance.

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Withdraw

The action of removing funds from an account, or the decision to exit from a particular position or investment.

Interest Rate

The percentage charged by a lender to a borrower for the use of assets, typically expressed as an annual percentage of the principal.

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The act of allocating resources, usually money, in the present with the expectation of receiving future returns or benefits.

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The value today of a future sum of money or cash flow sequence, discounted at a particular rate of return.