Question
A firm has decided to invest in a piece of land. Management has estimated that the land can be sold in 5 years for the
A firm has decided to invest in a piece of land. Management has estimated that the land can be sold in 5 years for the following possible prices:
Price Probability
15,000 .15
20,000 .30
25,000 .40
30,000 .15
(a)Determine the expected selling price for the land.
(b)Determine the standard deviation of the possible sales prices (SD). Explain. (c)Determine the coefficient of variation (CV). What is the difference between SD and CV? Explain
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Intermediate Microeconomics
Authors: Hal R. Varian
8th edition
393934241, 978-0393934243
