Use the Following Information to Answer the Question(s) Below

question 104

Multiple Choice

Use the following information to answer the question(s) below.
If managed effectively, Rearden Metal will have assets with a market value of $200 million, $300 million, or $400 million next year, with each outcome being equally likely. Managers, however, may decided to engage in wasteful empire building, which will reduce Rearden's market value by $20 million in all cases. Managers may also increase the risk of the firm, changing the probability of each outcome to 50%, 5%, and 45% respectively.
-Suppose that the managers at Rearden Metal will increase risk to maximize the expected payoff to equity holders.If Rearden has $180 million in debt due in one year,then the expected value of Rearden's assets are closest to:

• A) $280 million
• B) $295 million
• C) $300 million
• D) $900 million

Define what constitutes a group in social psychology.

Identify the effects of group size on individual behavior and decision-making.

Understand group dynamics including roles, communication structure, and power structure.

Analyze the influence of culture on conformity and obedience.

---

Definitions:

Deviant Activity

Behavior that violates social norms or expectations.

Constructionist Perspective

A viewpoint in sociology that emphasizes the ways social phenomena are created, institutionalized, and made into tradition by humans.

Objective Fact

Information verified through observation or measurement, independent of personal feelings or opinions.

Voluntary Act

An action taken by an individual based on free will and conscious decision.