You Are Trying to Decide in Which of the Three

question 78

Multiple Choice

You are trying to decide in which of the three companies you should invest. Refer to the following
Payoff Table.
If the probability of the Market rising in the next year is 0.50, which of the following statements are
Correct?
i. The Opportunity Loss for Company A is $1,460.
ii. The Opportunity Loss for Company B is $1,600.
iii. The Opportunity Loss for Company C is $1,475.

• A) (i), (ii), and (iii) are all correct statements.
• B) (i) is a correct statement but not (ii) or (iii).
• C) (i) and (iii) are correct statements but not (ii).
• D) (i) and (ii) are correct statements but not (iii).
• E) (i), (ii), and (iii) are all false statements.

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Definitions:

Quintile Distribution

Quintile distribution is a method of dividing a population into five equal groups or quintiles, based on variables such as income or wealth, to analyze economic inequality.

Income Receivers

Individuals or entities that earn income through various means such as employment, investments, or ownership of assets.

Gini Ratios

A gauge of how evenly income is distributed across a population, with a scale from 0 indicating absolute equality to 1 showing total inequality.

Income Inequality

A measure of the uneven distribution of income within a population.