Mark M Upp Has Just Been Fired as the University Book

question 81

Essay

Mark M. Upp has just been fired as the university book store manager for setting prices too low (only 20 percent above suggested retail). He is considering opening a competing bookstore near the campus, and he has begun an analysis of the situation. There are two possible sites under consideration. One is relatively small, while the other is large. If he opens at Site 1 and demand is good, he will generate a profit of $50,000. If demand is low, he will lose $10,000. If he opens at Site 2 and demand is high he will generate a profit of $80,000, but he will lose $30,000 if demand is low. He also has decided that he will open at one of these sites. He believes that there is a 50 percent chance that demand will be high. He assigns the following utilities to the different profits: For what value of utility for $50,000, U(50000), will Mark be indifferent between the two alternatives?

---

Definitions:

Emotional Loneliness

A feeling of isolation or detachment from others, despite possibly being surrounded by people.

Illness Transmission

The process by which diseases spread from one individual to another, through direct or indirect contact, or environmental exposure.

Evolutionary View

This perspective emphasizes the role of evolutionary processes in shaping organisms' physical and behavioral attributes over generations to adapt to their environments.

Cooperative Group Life

Activities and interactions within a group that promote mutual help, shared responsibilities, and collective efforts towards common objectives.