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You hired Helen to manage your coffee shop. The profits that you obtain from the coffee shop depend partially on how hard Helen works, and
You hired Helen to manage your coffee shop. The profits that you obtain from the coffee shop depend partially on how hard Helen works, and partially on chance: Probabilities of profit Profit = $2,000 Profit = $6,000 Helen works hard 0.4 0.6 Helen does NOT work hard 0.8 0.2 If Helen works hard, she experiences a personal cost of $500. If she does NOT work hard, she experiences no personal cost. Assume Helen only cares about her payment minus personal cost. What minimum fixed percentage of profits should you offer Helen to motivate her to work hard? O A. Just above 50% O B. Just above 20% O C. Just above 25% O D. Just above 31.25%
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