Home / Questions / More Expected Values Please show work along with answer Your company is exploring a poten...
More Expected Values: Please show work along with answer
1. Your company is exploring a potential oil field by drilling exploratory wells. Each well that is drilled has a 0.7% chance of finding the oil, which would be worth 20 million dollars, but it also has a 0.2% chance of a catastrophic explosion that would ruin the rig resulting in a loss of 5 million dollars. Additionally, it costs $125,000 for each drill site. How many drill sites should you order to maximize your total expected return? (whole number answer)
2. drilling the optimum number of drill sites, what is the expected return?
3. what is the probability you find the oil, at the optimal number of drill sites?
4. what is the probability you have a catastrophe? three decimals accuracy!
5. You have just been presented with an alternative: you can equip your drilling rigs with a device that lowers the probability of a catastrophe by 75%, but it increases the cost of each drill site by $2000. If you chose this option, what would your maximal expected profit be?
Apr 23 2020 View more View Less
If the vector has initial point , what is its terminal point?
Jul 18 2021Cash FlowFor the project whose cost data are given below, plot the cumulative project expenditures, value of work, and progress payments received versus time. What is the...
Jul 25 2021Which of the following entities is subject to the accumulated earnings tax? A. S corporationB. C corporationC. personal holding companyD. Sec. 501 tax-exempt corporation
Jul 16 2021Calculate the amount of copper (in moles) in a 36.3 g pure copper sheet.
Aug 20 2021Economics is best defined as the study of:a. how society manages its scarce resources.b. how to run a business most profitably.c. how to predict inflation, unemployment, ...
May 06 2021In an economy, if marginal propensity to save is 0.20, multiplier for the economy is [A]0.2 [B]0.8 [C]1 [D]5
Jan 10 2018please help > Beta Corporation issued new common stock at a market price of 40 Lira. Dividends last year were 2 Lira and are expected to grow at an annual rate of 4%. Fl...
Aug 18 20201. Alma Inc. has revenues of $750,000 resulting in an operating income of $52,500. Average invested assets total $375,000; the cost of capital is 10%. Return on investmen...
Jun 12 2021How can marketers use sensory memory?
Aug 23 2020What are the molecular equation and the net ionic equation of the neutralization of aqueous solutions of hydrocyanic acid, HCN, by lithium hydroxide, LiOH?
Jun 28 2021