Scenario 13.1 - Nefarious

question 41

Multiple Choice

Scenario 13.1 - Nefarious
The tenured professor routinely led student groups on factory tours in exotic locales,and one popular destination was an island south of Miami.The students enjoyed this happy little island and the professor liked it because he could supplement his income by bringing back a few boxes souvenirs he could sell to his friends.The souvenirs cost the professor $125 a box and he sells them for $290 a box.Souvenirs that dry out due to age can be sold for $80.Experience has shown that the demand for boxes of these souvenirs has a mean of 80 with a standard deviation of 20.
-The professor's suitcase has room for 50 boxes of souvenirs.What is his expected profit?

• A)$10,241
• B)$11,975
• C)$9,863
• D)$8,127

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Definitions:

Sectoral Shocks

Unexpected events that cause significant shifts in demand or supply in a specific sector of the economy, leading to changes in prices and output levels.

Frictional Unemployment

Unemployment due to the time workers spend in job search, usually short-term and occurring when individuals are transitioning between jobs.

Natural Rate

Often referred to as the natural rate of unemployment, it is the level of unemployment consistent with a stable rate of inflation, where the labor market is in equilibrium.

Cyclical Unemployment

Unemployment that results from business cycle fluctuations in economic activity, particularly downturns, rather than from changes in the workforce or skill mismatches.