Use the Information for the Question(s)below

question 86

Multiple Choice

Use the information for the question(s) below.
Wildcat Drilling is an oil and gas exploration company that is currently operating two active oil fields with a market value of $200 million each.Unfortunately,Wildcat Drilling has $500 million in debt coming due at the end of the year.A large oil company has offered Wildcat drilling a highly speculative,but potentially very valuable,oil and gas lease in exchange for one of their active oil fields.If Wildcat accepts the trade,there is a 10% chance that Wildcat will discover a major new oil field that would be worth $1.2 billion,a 15% that Wildcat will discover a productive oil field that would be worth $600 million,and a 75% chance that Wildcat will not discover oil at all.
-What is the overall expected payoff to Wildcat from the speculative oil lease deal?

• A)$360 million
• B)$275 million
• C)$85 million
• D)$160 million

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Definitions:

Peripheral Nervous System

The part of the nervous system that consists of the nerves and ganglia outside of the brain and spinal cord.

Sympathetic

Referring to the part of the autonomic nervous system that increases bodily readiness for action during times of stress.

Autonomic

Pertaining to the part of the nervous system that controls involuntary bodily functions such as heartbeat, digestion, and breathing.

Cell Body

Part of the neuron where information from thousands of other neurons is collected and integrated.