After graduating, Sallie Handshake's best job offer will either be with a Big-8 accounting firm for $160,000 a year or as a State Farm agent in Grand Rapids, Michigan, for $40,000 a year.She can increase the probability of the former outcome by studying more, but such studying has its costs.If S represents her amount of studying (where S = 0 is no study and S = 1 is all-out effort), her probability of getting the job with a Big-8 firm just equals S.Her utility depends on how hard she studies and her subsequent annual income Y.She tries to maximize the expected value of the von Neuman-Morgenstern utility function U(S, Y)= Y^1/2 - 400S².If she chooses S to maximize her expected utility, how much will she study? A)S = 0.1. B)S = 0.25. C)S = 0.5. D)S = 0.75. E)S = 0.9.

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The Answer of After graduating, Sallie Handshake's best job offer will either be with a Big-8 accounting firm for $160,000 a year or as a State Farm agent in Grand Rapids, Michigan, for $40,000 a year.She can increase the probability of the former outcome by studying more, but such studying has its costs.If S represents her amount of studying (where S = 0 is no study and S = 1 is all-out effort), her probability of getting the job with a Big-8 firm just equals S.Her utility depends on how hard she studies and her subsequent annual income Y.She tries to maximize the expected value of the von Neuman-Morgenstern utility function U(S, Y)= Y^1/2 - 400S².If she chooses S to maximize her expected utility, how much will she study? A)S = 0.1. B)S = 0.25. C)S = 0.5. D)S = 0.75. E)S = 0.9.

After Graduating, Sallie Handshake's Best Job Offer Will Either Be