Use the Information for the Question(s)below

question 43

Multiple Choice

Use the information for the question(s) below.
Big Cure and Little Cure are both pharmaceutical companies.Big Cure presently has a potential "blockbuster" drug before the Food and Drug Administration (FDA) waiting for approval.If approved,Big Cure's blockbuster drug will produce $1 billion in net income for Big Cure.Little Cure has 10 separate less important drugs before the FDA waiting for approval.If approved,each of Little Cure's drugs would produce $100 million in net income for Little Cure.The probability of the FDA approving a drug is 50%.
-The standard deviation of Little Cure's average net income for their ten new drugs is closest to:

• A)$50 million.
• B)$25 million.
• C)$16 million.
• D)$500 million.

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Definitions:

Social Security Taxes

Social Security taxes are taxes collected from employees and employers to fund the Social Security program, providing retirement, disability, and survivors' benefits.

Government Expenditures

The total amount of spending by the government, including on services, infrastructure, and social welfare programs.

State and Local

Pertaining to government entities and functions at the subnational levels, including states, provinces, territories, cities, and towns.

Marginal Rate

The marginal rate often refers to the rate at which the next unit of time, expenditure, or activity will be valued, commonly used in the context of marginal tax rates or marginal rate of substitution in economics.