Shared with me - Goo X M (no subject) - alejandrox M (no subject) - alejandro x M Inbox (4,903) - aserrar X G Jonathan is risk neutra X Login with SSO - Zoo X Homework Help - Q& X + V X > C a mail.google.com/mail/u/3/?ogbl#inbox?projector=1 A Update = M Gmail Q Search 22. (30 points) Jonathan is risk neutral, and he is deciding whether to open a motorbike shop. He is uncertain about the economic condition when making this decision. There are two tive ? UMass Amherst possibilities for the economic condition: Good or Bad. If Jonathan decides to open the motorbike shop and the economic condition turns out to be good, then he can earn a net profit 1-50 of 6,595 Compose of $100,000. If Jonathan decides to open the shop and the economic condition turns out to be Jing bad, then he will suffer a net loss of $50,000. If Jonathan decides not to open the motorbike your homework grades and team e.. 1:03 PM shop, then he can put the money in a savings account and earn an interest of $12,000. Mail Spar Jonathan's prior belief is that there is 50% chance that the economic condition is good, and ink for the exam: https: 50% chance that it is bad. We can represent Jonathan's decision with the following decision Inbox 4,903 tree: Good Starred $100,000 0.5 me, Open 052563126 ) and email > Sparshi Srivastava Snoozed 0.5 -$50,000 Sent Melis 11:03 AM Bad CPC All Members Forum" community . . 10:07 AM Chat Do Not Open Stud $12,000 go here. Sell your books and retur. May 5 Ann a. What would Jonathan choose based on his prior belief on the economic condition? What unity, As classes for the semester . May 5 is the value of this investment decision for Jonathan? (5 points) No conversations Whit to you on behalf of the Black Advis. May 5 Start a chat Nath some of our black undergraduate s.. May 5 Spaces Now, Jonathan is considering paying an economic consulting firm to get an expert report on Jane whether the economic condition is going to be "Good" or "Bad". From reading reviews on Alejandro, help other students lear. May 5 the consulting firm's previous performances, Jonathan finds out that the consulting firm has a Meli 90% accuracy in predicting the economic conditions. That is, if the economic condition is May 5 No spaces yet good, then 90% of the chance the consulting firm's report will be "Good"; if the economic Create or find a space CPC condition is bad, then 90% of the chance the consulting firm's report will be "Bad". thors in the "CPCU All Members Fo.. May 5 Meet UMas b. In the information gathering process, what is Jonathan's distinction of interest? What is celebration UMass Amherst Alum. May 5 the observed distinction? (5 points) Type here to search O 65.F Cloudy 1:38 PM ENG 5/6/2022Shared with me - Goo x M (no subject) - alejandro x M (no subject) - alejandro x M Inbox (4,903) - aserrar X G Jonathan is risk neutra X Login with SSO - Zoo X Homework Help - Q& x + V X C e mail.google.com/mail/u/3/?ogbl#inbox?projector=1 A Update good, then 90% of the chance the consulting firm's report will be "Good"; if the economic Gmail Q Search condition is bad, then 90% of the chance the consulting firm's report will be "Bad". tive ? UMass Amherst b. In the information gathering process, what is Jonathan's distinction of interest? What is Compose the observed distinction? (5 points) 1-50 of 6,595 Jing your homework grades and team e.. 1:03 PM Mail Spar ink for the exam: https: Inbox 4,903 Starred me, 8 052563126 ) and email > Sparshi Srivastava Snoozed Melis 11:03 AM Sent CPCU All Members Forum" community . . 10:07 AM Chat Stud go here. Sell your books and retur.. May 5 Ann unity, As classes for the semester . May 5 No conversations Whit c. Draw the assessed form probability tree. Be sure to label and record all relevant to you on behalf of the Black Advis. May 5 Start a chat probabilities on the tree (priors, likelihoods and joint probabilities). (5 points) Nath some of our black undergraduate s.. May 5 Spaces Jane Alejandro, help other students lear. May 5 Meli May 5 No spaces yet Create or find a space CPC thors in the "CPCU All Members Fo.. May 5 UMas Page 9 / 13 - + celebration UMass Amherst Alum. May 5 Meet Type here to search 65.F Cloudy 1:39 PM A ENG 5/6/2022Shared with me - Goo X M (no subject) - alejandrox M (no subject) - alejandroX M Inbox (4,903) - aserrar X G Jonathan is risk neutra X Login with SSO - Zoo X Homework Help - Q& x + V X -> C a mail.google.com/mail/u/3/?ogbl#inbox?projector=1 A Update = M Gmail Q Search tive ? UMass Amherst d. Draw the inferential form probability tree. Be sure to label and record all relevant O . probabilities on the tree (pre-posteriors, posteriors, and joint probabilities). (5 points) 1-50 of 6,595 Compose Jing your homework grades and team e.. 1:03 PM Mail Spar ink for the exam: https: Inbox 4,903 Starred me, 052563126 ) and email > Sparshi Srivastava Snoozed Sent Melis 11:03 AM CPC All Members Forum" community . . 10:07 AM Chat Stud go here. Sell your books and retur. May 5 Ann unity, As classes for the semester . May 5 No conversations Whit to you on behalf of the Black Advis. May 5 Start a chat Nath some of our black undergraduate s. May 5 Spaces Jane Alejandro, help other students lear. May 5 Melis May 5 No spaces yet Create or find a space CPC hors in the "CPCU All Members Fo.. May 5 UMas Page 9 / 13 - + celebration UMass Amherst Alum. May 5 Meet Type here to search 65.F Cloudy 1:39 PM A ENG 5/6/2022Shared with me - Goo X M (no subject) - alejandrox M (no subject) - alejandroX M Inbox (4,903) - aserrar X G Jonathan is risk neutra X Login with SSO - Zool X Homework Help - Q& x + V X -> C a mail.google.com/mail/u/3/?ogbl#inbox?projector=1 A Update = M Gmail Q Search tive ? UMass Amherst e. If the report from the consulting firm predicts that the economic condition is "Good", what are Jonathan's updated beliefs about the economic condition? Would 1-50 of 6,595 Compose Jonathan choose to open the shop? (5 points) Hint: If Jonathan opens the shop based on a report of "Good", his beliefs are Jing {Good | "Good", & } and + {Bad|"Good", &} from the inferential tree. The value if he your homework grades and team e. 1:03 PM Mail opens the shop would get {Good | "Good", &} x $100,000 + {Bad|"Good", &} x Spar (-$50,000). ink for the exam: https: Inbox 4,903 Starred me, 52563126 ) and email > Sparshi Srivastava Snoozed Sent Melis f. If the report from the consulting firm predicts that the economic condition is "Bad", 11:03 AM what are Jonathan's updated beliefs about the economic condition and would Jonathan CPC choose to open the shop? ( 5 points) All Members Forum" community . . 10:07 AM Chat Hint: If Jonathan opens the shop based on a report of "Bad", his beliefs are Stud {Good | "Bad", &} and + {Bad|"Bad", &} from the inferential tree. The value if he opens go here. Sell your books and retur. May 5 the shop would get {Good | "Bad", &} x $100,000 + {Bad|"Bad", &} x (-$50,000). Ann unity, As classes for the semester . May 5 No conversations Whit to you on behalf of the Black Advis. May 5 Start a chat Nath some of our black undergraduate s.. May 5 Spaces . [Bonus question, 10 points] What is the value of the information from the report of the Jane consulting firm? Hint: the value of the information will be the value of the decision with Alejandro, help other students lear. May 5 free report minus the value of the decision without any additional information. Meli May 5 No spaces yet Create or find a space CPC thors in the "CPCU All Members Fo. May 5 Page 2 10 / 13 + May 5 Meet UMas celebration UMass Amherst Alum. Type here to search 65.F Cloudy 1:39 PM ENG 5/6/2022