Use the Information for the Question(s)below

question 13

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%.
-What is the expected payoff for Little Cure's ten drugs?

• A)$500 million
• B)$100 million
• C)$1 billion
• D)$0

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Definitions:

Hawthorne Experiment

A five-year study conducted at the Western Electric plant in Hawthorne, Illinois, that showed that workers performed better when someone was paying attention to them.

Elton Mayo

A pioneering researcher in organizational theory, particularly known for his work on the Hawthorne Studies, which highlighted the importance of social relations in the workplace.

Mutual Respect

A reciprocal understanding and recognition of the value and importance of others, fostering positive relationships and communication.

Theory Y

A management approach that assumes employees are motivated, self-directed, and enjoy the work they do, advocating for a participative style.