The local operations manager for the Canada Revenue Agency decides whether to hire one,two,or three temporary tax examiners for the upcoming tax season.She estimates that net revenues (in thousands of dollars)will vary with how well taxpayers comply with the new tax code just passed by Parliament,as follows: If she feels the chances of low,medium,and high compliance are 20%,30%,and 50%,respectively,what is her expected value of perfect information?
A)$16,000
B)$26,000
C)$46,000
D)$48,000
E)$50,000

Question

The local operations manager for the Canada Revenue Agency decides whether to hire one,two,or three temporary tax examiners for the upcoming tax season.She estimates that net revenues (in thousands of dollars)will vary with how well taxpayers comply with the new tax code just passed by Parliament,as follows:  If she feels the chances of low,medium,and high compliance are 20%,30%,and 50%,respectively,what is her expected value of perfect information?
A)$16,000 
B)$26,000 
C)$46,000 
D)$48,000 
E)$50,000

Quizplus · Accepted Answer

The Answer of The local operations manager for the Canada Revenue Agency decides whether to hire one,two,or three temporary tax examiners for the upcoming tax season.She estimates that net revenues (in thousands of dollars)will vary with how well taxpayers comply with the new tax code just passed by Parliament,as follows:  If she feels the chances of low,medium,and high compliance are 20%,30%,and 50%,respectively,what is her expected value of perfect information?
A)$16,000 
B)$26,000 
C)$46,000 
D)$48,000 
E)$50,000

The Local Operations Manager for the Canada Revenue Agency Decides