Onyx Expects to Have an EBIT of $240,000 with a Standard

question 6

Multiple Choice

Onyx expects to have an EBIT of $240,000 with a standard deviation of $110,000. The distribution of operating income is approximately normal. If Onyx has interest expenses of $50,000, what is the probability that it will have an operating income that is below $0? (Problem requires a normal distribution table.)

• A) 4.27%
• B) 1.46%
• C) 0.02%
• D) 2.4%

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Definitions:

Self-Interest

The motivating force in economics that drives individuals to pursue their goals in a way that is most beneficial to them.

Risk Management

The process of identifying, assessing, and prioritizing risks followed by the application of resources to minimize, control, or eliminate the impact of unforeseen events.

Command Economies

Command economies are economic systems where the government or a central authority makes all decisions regarding the production and distribution of goods and services.

Government Officials

Individuals who hold positions of authority in government institutions and are responsible for making and implementing public policies and laws.