2. Kramerica Company has a small plant worth $10,000. The plant is subject to physical damages and total destruction as a result of fire. From over 6,000 industry observations, the firm has derived the following probability distribution of fire losses for its physical plant. Loss Amount ($) Probability of Loss 0 0.89 1,500 ? 6,000 0.065 10,000 0.005 Kramerica is considering the following risk management options: [1] Retention [2] Partial insurance Face Amount = $8,000; Premium = $580 [3] Deductible insurance Face Amount = $10,000; Premium = $470; Deductible per occurrence = $1,000 [4] Full insurance Face Amount = $10,000; Premium = $600 a. Construct the loss matrix from Kramerica’s perspective. Make sure you show loss in the top row and out-of-pocket cost in the bottom row in each cell of the loss matrixEx. [2 points] b. Construct the payout matrix from an insurer’s perspective. [2 points] c. What is the AFP for deductible insurance in this case? [2 points] d. Assume that the company’s decision rule is to pick the option that minimizes TOTAL EXPECTED COST. Can you identify what risk management option is chosen? Why or why not? Make sure that you show all calculations and clearly define TOTAL EXPCTED COST in each case. [2 points]

Warby parker, a manufacturer of fashionable prescription eyewear, notes on its website, "warby parker was founded with a rebellious spirit and a loft objective: to offer designer eyewear at a revolutionary price, while leading the way for socially-conscious business." this excerpt from the company's website states warby parker's

Gdp has grown in a country at 3% per year for the last 20 years. the labor force has grown at 2% per year and the quantity of physical capital has grown at 4% per year. a 1% increase in average physical capital per worker (other things equal) raises productivity by 0.3%. average education has not changed. how much has growing physical capital per worker contributed to productivity growth in this country? choose the correct answer from the following choices, and then select the submit answer button. answer choices 0.3% 0.6% 3.0% 6.0%

He cheyenne hotel in big sky, montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. an occupancy-day represents a room rented out for one day. the hotel's business is highly seasonal, with peaks occurring during the ski season and in the summer. month occupancy- days electrical costs january 1,736 $ 4,127 february 1,904 $ 4,207 march 2,356 $ 5,083 april 960 $ 2,857 may 360 $ 1,871 june 744 $ 2,696 july 2,108 $ 4,670 august 2,406 $ 5,148 september 840 $ 2,691 october 124 $ 1,588 november 720 $ 2,454 december 1,364 $ 3,529 required: 1. using the high-low method, estimate the fixed cost of electricity per month and the variable cost of electricity per occupancy-day. (do not round your intermediate calculations. round your variable cost answer to 2 decimal places and fixed cost element answer to nearest whole dollar amount) 2. what other factors other than occupancy-days are likely to affect the variation in electrical costs from month to month? (you may select more than one answer. single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.) seasonal factors like winter or summer. systematic factors like guests, switching off fans and lights. number of days present in a month. fixed salary paid to hotel receptionist. income taxes paid on hotel income.