Alex,who Is Risk-Neutral,is Looking for an Apartment

question 132

Multiple Choice

Alex,who is risk-neutral,is looking for an apartment.The distribution of apartments of equal quality is as follows: 70% rent for $700 per month,20% rent for $600 per month,and 10% rent for $500 per month.Alex's costs of searching rise by $10 with each search.
The first apartment Alex visits rents for $700.What is the expected value of visiting a second apartment?

• A)$20
• B)$30
• C)$40
• D)$50

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Definitions:

Head Start

A program in the United States that provides comprehensive early childhood education, health, nutrition, and parent involvement services to low-income children and families.

Cognitive Development

The process of growth and change in intellectual/mental abilities such as thinking, reasoning, and understanding, throughout a person's lifespan.

Focus School

An educational institution that concentrates on a specific curriculum or set of skills, targeting particular learning needs or interests.

Preschool Intervention

Programs or strategies aimed at enhancing the development, learning, and well-being of preschool-aged children.