Nick Has Plans to Open Some Pizza Restaurants,but He Is

question 3

Multiple Choice

Nick has plans to open some pizza restaurants,but he is not sure how many to open.He has prepared a payoff table to help analyze the situation. Nick believes there is a 40 percent chance that the market will be good,a 30 percent chance that it will be fair,and a 30 percent chance that it will be poor.A market research firm will analyze market conditions and will provide a perfect forecast (they provide a money back guarantee) .What is the most that should be paid for this forecast?

• A)$ 44,000
• B)$ 53,000
• C)$123,000
• D)$176,000
• E)$132,000

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Definitions:

Production Possibilities Curve

A graph that shows the combinations of two goods that can be produced using all available resources and technology efficiently.

International Specialization

The economic strategy where countries focus on the production and export of goods and services that they can produce most efficiently.

Full Employment

An economic condition where all available labor resources are being used in the most efficient way possible, typically signifying a very low unemployment rate.

Productive Efficiency

A state where an economy or firm produces goods or services at the lowest possible cost, using all resources effectively.