A manager believes there is a 10 percent chance their firm will have to pay $500,000, a 20 percent chance that they will have to pay $400,000 and a 70 percent chance they will be found innocent and pay nothing except the legal fees of $100,000. The manager has been offered a settlement deal of $230,000, which the manager's firm would have to pay the plaintiff. If the manager flips a coin to
decide to enter litigation or to settle, the manager is ________.
A) a risk lover
B) risk intolerant
C) risk neutral
D) risk averse
C) risk neutral
You might also like to view...
Looking at the U.S. balance of payments for the last two decades, how have the current account and the capital account changed?
What will be an ideal response?
The circular flow diagram of economic activity is a model of the
a. flow of goods, services, and payments between households and firms. b. influence of government on business behavior. c. role of unions and government in the economy. d. interaction among taxes, prices, and profits.
In general, when a nation has an absolute advantage over other nations in a particular product, it can produce that product:
A. in greater absolute quantities. B. at a lower opportunity cost of production. C. with fewer inputs per unit. D. without sacrifices in terms of other products.
The act of Congress which prohibited "unfair or deceptive acts or practices in commerce" is called
A) the Federal Trade Commission Act of 1914. B) the Clayton Act. C) the Sherman Act. D) the Robinson-Patman Act.