Consider the Following to Answer the Question(s) Below

question 26

Multiple Choice

Consider the following to answer the question(s) below:
An airline has found that its flights between Toronto and Vancouver can take anywhere from 4.5 to 7.5 hours, with any time between this range being equally likely.
-What is the probability that the flight will take more than 7 hours?

• A) 0.83
• B) 0.33
• C) 0.67
• D) 0.17
• E) 0.99

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Definitions:

Miller-Orr Model

A mathematical model used in finance to manage cash flow and determine the optimal level of cash balances for a firm.

BAT Model

A theoretical framework that outlines the potential consequences of Brexit across different sectors and regions.

Target Cash Balance

An optimal amount of cash that a company aims to hold to satisfy its operational and transactional requirements while minimizing holding costs.

Uncertainty

Refers to the degree of unpredictability or the lack of certainty about the future, often affecting decision-making in finance and economics.