Wayne and Gary's Dinner (located in Letterkenny) is selling three products this year. The table below...
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Wayne and Gary's Dinner (located in Letterkenny) is selling three products this year. The table below provides the NPV of all cash flows for each product depending on market conditions. Good Market Fair Market $26,000 $38,000 $14,000 Apple Pie Banana Cake Blueberry Pancakes $45,000 $60,000 $32,000 Poor Market -$4,000 -$20,000 $10,000 The respective probabilities of a good, fair, and poor market are .3, .45, and .25. Their friend Stewart who knows the market well has offered to tell them the market condit this upcoming year ahead of time, thus providing them with perfect information. What is maximum they should be willing to pay Stewart for this information? (Answer to the near number) Wayne and Gary's Dinner (located in Letterkenny) is selling three products this year. The table below provides the NPV of all cash flows for each product depending on market conditions. Good Market Fair Market $26,000 $38,000 $14,000 Apple Pie Banana Cake Blueberry Pancakes $45,000 $60,000 $32,000 Poor Market -$4,000 -$20,000 $10,000 The respective probabilities of a good, fair, and poor market are .3, .45, and .25. Their friend Stewart who knows the market well has offered to tell them the market condit this upcoming year ahead of time, thus providing them with perfect information. What is maximum they should be willing to pay Stewart for this information? (Answer to the near number)
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Related Book For
Practical Management Science
ISBN: 978-1305250901
5th edition
Authors: Wayne L. Winston, Christian Albright
Posted Date:
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