Consider the Following to Answer the Question(s) Below

question 15

Multiple Choice

Consider the following to answer the question(s) below:
A landowner is considering a community development project. Even though he realizes that the current market for housing is not very favourable, he believes that there will be an influx of retirees into the area within the next five years. He is trying to decide between two alternatives: (1) building detached homes in a planned retirement community or (2) building a smaller townhouse/condominium complex. Mortgage interest rates will affect his outcomes and the applicable payoff (in $ millions) table is shown below.
-Suppose housing analysts predict that the probabilities for future mortgage interest rates going up, staying about the same, and going down are 0.35, 0.50 and 0.15, respectively. The expected value for building detached homes in a planned retirement community is

• A) $2.5 million.
• B) $3.625 million.
• C) $2.75 million.
• D) $875,000.
• E) $46.25 million.

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Definitions:

Frederick Herzberg

A psychologist best known for developing the Motivation-Hygiene Theory, which differentiated between motivators that increase job satisfaction and hygiene factors that, if absent, can cause dissatisfaction.

Satisfiers

Factors that contribute to job satisfaction and motivate employees, influenced by aspects of work that enhance positive feelings.

Job Content

The specific duties, responsibilities, and functions of a job, which define its scope and nature.

Rewards

Benefits or compensations given to employees as a form of recognition for their contributions or achievements.