Consider the two options in the following table, both of which have random outcomes: a. Determine the expected value of each option. b) Determine the variance and standard deviation of each option. c. Which option is most risky? 4. You are the manager of a firm that sells a "commodity in a market that remembers perfect competition, and your cost function is c(Q) = 2Q + 3Q2. Unfortunately, due to production lags, your must make your output decision prior to knowing for certain the price that will prevail in the market. You believe that there it a 70 percent chance the market pnee will he $200 and a 30 percent chance it will be $600. a. Calculate the expected nurkci price. b. What output you produce in order to maximize expected profits? c. What are your expected profits? 10. Life insurance policies typically have clauses stipulating the insurance company will not pay claims arising from suicide for a specified term-typically two years from the date the policy was issued. Use precise economic terminology to explain the likely impact on an insurance company's bottom line if it were to eliminate such a clause