3. Suppose in Technical Problem 2 that the price probabilities are reversed: The manager expects a price

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3. Suppose in Technical Problem 2 that the price probabilities are reversed: The manager expects a price of $15 with a probability of 60 percent and a price of $20 with a probability of 40 percent. Answer all parts of Technical Problem 2 under the assumption of these reversed probabilities. What would the probabilities have to be to make the expected values of the two options equal?

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Managerial Economics

ISBN: 9780073375915

10th Edition

Authors: Christopher R Thomas, S Charles Maurice

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