A Retailer Is Considering Building a Large Store

question 171

Multiple Choice

A retailer is considering building a large store. If the local economy experiences expansion, the firm expects the store to earn a $2,000,000 profit next year. If the local economy experiences a contraction, the firm expects the store to lose $400,000 next year. Analysts estimate a 30% chance for the local economy to experience an expansion next year (hence a 70% chance for contraction) . What is the expected monetary value (EMV) of building the large store?

• A) $880,000
• B) $320,000
• C) $2,000,000
• D) $80,000
• E) $1,520,000

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Definitions:

Informational Molecule

A molecule that carries or transmits biological information, essential for processes such as DNA synthesis and protein production.

RNA Molecules

Molecules composed of ribonucleic acid (RNA) that play various roles in coding, decoding, regulation, and expression of genes.

Enzymes

Biological catalysts that speed up chemical reactions in living organisms without being consumed in the process.

Abiotic Evolution

The process of environmental and geological changes over time, not influenced by biological factors.