Use the Information Below to Answer the Following Question(s)

question 37

Multiple Choice

Use the information below to answer the following question(s) .
Below is a decision tree illustrating the R&D process for a new drug.

Let us assume that if the market is large, the payoff is lognormally distributed with a mean of $ 4,900 million and a standard deviation of $ 1,000 million; if the market is medium, the payoff is lognormally distributed with a mean of $2,500 million and a standard deviation of $500 million; and if the market is small, the payoff is normally distributed with a mean of $1,800 million and standard deviation of $200 million.

-What is the value of standard deviation obtained from the simulation results? [Hint: Choose the approximate value.]

• A)$ 119.0
• B)$ 116.1
• C)$ 105.7
• D)$ 94.4

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Definitions:

Katz's Skills Model

A leadership model proposed by Robert Katz that suggests three core leadership skills: technical, human, and conceptual.

Tax Law

The legal domain encompassing rules, policies, and procedures that oversee the legal process regarding taxation.

Accounting Principles

Fundamental concepts and rules that guide the practice of accounting, ensuring transparency, consistency, and accuracy in financial reporting.

Skills Model

A framework suggesting that effective leadership is based on certain learnable skills, including technical, human, and conceptual skills.