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Florentino Allers is the production manager of Electronics Manufacturer. Due to limited capacity, the company can only produce one of two possible products: - An
Florentino Allers is the production manager of Electronics Manufacturer. Due to limited capacity, the company can only produce one of two possible products: - An industrial motherboard with a 70% probability of making a profit of $1 million and a 30% probability of making a profit of $150,000. - A regular motherboard with a 100% chance of making a profit of $690,000. A. Which option is Florentino more likely to choose and why? motherboard). B. Which option would the company be more likely to choose and why? higher , the potential difference of $ to offset the higher risk C. What changes should the company make to Florentino's compensation to avoid unnecessary risks
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