For Questions Use the Following Narrative

question 23

Essay

For Questions use the following narrative:
Narrative: Shaking hands
Suppose the chances of picking up a cold from someone by shaking hands with them is .01 (assuming you don't know whether they have a cold or not), and that each encounter you have is independent of another.
-{Shaking hands narrative} Explain, using probability, why your chance of not getting a cold in a given day decreases as the number of handshakes you make increases?

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Definitions:

Profit-Maximizing Rule

A principle that states a firm reaches its highest profit when its marginal cost equals its marginal revenue.

Marginal Revenue

The revenue increase from the sale of one more unit of a product or service.

Marginal Cost

is the increase in total cost that arises from producing one additional unit of a product or service.

Total Fixed Cost

The total fixed cost refers to the sum of all costs that do not change with the level of output produced by a company or during a specific period.