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You Are Considering Buying a Share of Stock in a Firm

question 23

Multiple Choice

You are considering buying a share of stock in a firm that has the following two possible payoffs with the corresponding probability of occurring.The stock has a purchase price of $50.00.You forecast that there is a 40% chance that the stock will sell for $70.00 at the end of one year.The alternative expectation is that there is a 60% chance that the stock will sell for $30.00 at the end of one year.What is the expected percentage return on this stock,and what is the standard deviation of returns on this stock?

Analyze political decision-making, including stakeholder influence and methods of political influence.

Acknowledge the role of creativity in generating novel and useful ideas or concepts.

Examine the impact of leadership and cultural practices on decision-making in organizations.

Differentiate between various decision-making conditions (certainty, risk, uncertainty) and strategies (e.g., brainstorming, reverse brainstorming).

Definitions:

Private Goods

Describes products that are excludable and rivalrous, meaning their use by one individual prevents use by another.

Private Consumptions

Expenditure by households and individuals on goods and services for personal use, excluding purchases by businesses or government.

Pareto Optimal

A resource distribution paradigm where it's unattainable to ameliorate the situation of one individual without diminishing that of another.

Utility Functions

Representations of an individual's preference ordering over a set of goods or outcomes, quantifying the satisfaction obtained from each.