An Apple Farmer Must Decide How Many Apples to Harvest

question 18

Multiple Choice

An apple farmer must decide how many apples to harvest for the world apple market.He knows that there is a one-third probability that the world price will be $1,a one-third probability that it will be $1.50,and a one-third probability that it will be $2.His cost function is C(Q) = 0.01Q².What is the expected price in the world apple market?

• A) $1.50
• B) $1.80
• C) $2.00
• D) $1.40

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Definitions:

Cluster Sampling

A sampling technique where the population is divided into clusters, and a random sample of these clusters is selected for study.

Numerical Composition

The arrangement or structure of numbers or quantities within a particular domain or dataset.

Simple Random Sampling

A sampling method where each member of a population has an equal chance of being included in the sample.

Equal Probability

This refers to the concept that all outcomes or members of a population have the same chance of occurring or being chosen.