Answered step by step
Verified Expert Solution
Question
1 Approved Answer
A farmer plants a crop in the spring and plans to sell 1.5M bushels to the market at harvest in 180 days. The farmer expects
A farmer plants a crop in the spring and plans to sell 1.5M bushels to the market at harvest in 180 days. The farmer expects the price distribution in 180 days to have an expected value of $3.50/bu and a standard deviation of $0.45/ bu. Assuming the distribution is normal.
1) Determine the expected value and standard deviation of the famers revenue from this sale in 180 days.
2) What level of revenue would correspond to the worst 5% outcome?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started