The Head of Operations for a Movie Studio Wants to Determine

question 70

Multiple Choice

The head of operations for a movie studio wants to determine which of two new scripts they should select for their next major production. (Due to budgeting constraints, only one new picture can be undertaken at this time.) She feels that script 1 has a 70 percent chance of earning about $10,000,000 over the long run, but a 30 percent chance of losing $2,000,000. If this movie is successful, then a sequel could also be produced, with an 80 percent chance of earning $5,000,000, but a 20 percent chance of losing $1,000,000. On the other hand, she feels that script 2 has a 60 percent chance of earning $12,000,000, but a 40 percent chance of losing $3,000,000. If successful, its sequel would have a 50 percent chance of earning $8,000,000, but a 50 percent chance of losing $4,000,000. Of course, in either case, if the original movie were a flop, then no sequel would be produced.
What is the expected value of selecting script 1?

• A)$15,000,000
• B)$9,060,000
• C)$8,400,000
• D)$7,200,000
• E)$6,000,000

Calculate gross pay including overtime.

Determine commission rates and earnings based on sales and transactions.

Calculate earnings from piece-rate and commission-based work.

Understand and perform percentage calculations for various scenarios.

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Definitions:

Performance

The execution of duties or actions stipulated by a contract.

Third Party

An entity involved in a transaction or legal situation who is neither the first (often the buyer or claimant) nor the second (often the seller or defendant) principal party.

Express Condition

A specific and explicitly stated requirement in a contract that must be met for contractual obligations to be fulfilled.

Certificate of Occupancy

An official document issued by a local government agency or building department certifying a building's compliance with applicable building codes and other laws, indicating it is in a condition suitable for occupancy.