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

question 52

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 decide 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.
-What is the expected value of Rearden's assets if it were run efficiently?

• A)$265 million
• B)$280 million
• C)$295 million
• D)$300 million

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Definitions:

Politics From The Person

The idea that personal beliefs, values, and experiences significantly influence one's political views and actions.

Social Decentering

The psychological process of considering and adapting to the thoughts, feelings, and perspectives of others.

Empathy

Emotional reaction that is similar to the reaction being experienced by another person; empathizing is feeling what another person is feeling.

Predictive Adaptation

The ability to change or modify one's behavior in anticipation of future events or changes in the environment.