ABC Explosives has purchased re insurance for its factory It can institute a re prevention program, which would cost $90, but which would lower the probability of a re from 001 to 0001' The insurance company cannot determine whether ABC has instituted the program However, it charges a deductible in the event of a re (itet ABC has to pay a certain amount to the insurance company if a re occurs) What is the smallest deductible that will encourage ABC to institute the re prevention program? 0 a. 3100 O b. $1,000 0 c. $5,000 0 d. $10,000 0 e. $15,000 0 ft $20,000 0 g. $100,000 Old MacDonald produces hay. He has a single employee, Jack. If Jack works for x hours he can produce x bales of hay. Each bale of hay sells for $1. The cost to Jack of working x hours is c(x) = (x*2)/10. What is the efficient number of bales of hay for Jack to cut? O a. 0 O b. 1 2 O d. 3 . 4 5 O g. 6 If the most that Jack could earn elsewhere is zero, how much would MacDonald have to pay him to get him to work the efficient amount? O a. $0 O b. $1 O c. $1.5 O d. $2 O e. $2.5 Of. O g. $3.5 Oh. $4 What is MacDonald's net profit? O a. $0 O b. $1 O c. $1.5 O d. $2 O e. $2.5 Of. $3 O g. $3.5 Oh. $4