The Function $\mathrm { E } ( \mathrm { x } ) = 0.0036 \mathrm { x } ^ { 3 } + 0.0055 \mathrm { x } ^ { 2 } + 0.19 \mathrm { x } + 1.76$

question 305

Multiple Choice

The function $\mathrm { E } ( \mathrm { x } ) = 0.0036 \mathrm { x } ^ { 3 } + 0.0055 \mathrm { x } ^ { 2 } + 0.19 \mathrm { x } + 1.76$ gives the approximate total earnings of a company, in millions of dollars, where $x = 0$ corresponds to $2006 , x = 1$ corresponds to 2007 , and so on. This model is valid for the years from 2006 to 2010 . Determine the earnings for 2007. Round to two decimal places if necessary.

• A) $1.76 million
• B) $2.19 million
• C) $1.95 million
• D) $1.96 million

---

Definitions:

Risk Premium

The extra return above the risk-free rate that investors require as compensation for the higher risk of investing in a particular asset.

Market Risk

The risk of losses in investments due to market variables, such as changes in interest rates, currency exchange rates, or stock market fluctuations.

Expected Rate Of Return

The profit or loss an investor anticipates on an investment, expressed as a percentage of the investment's initial cost.

Common Stock

A form of corporate equity ownership, representing a claim on a portion of the corporation's assets and earnings.