Suppose Alana has personal wealth of $10,000 and there is a probability of 0.2 of losing her car worth $6,400 in an accident. Her utility (of wealth) function is given by u(w) = w0.5, where w is wealth. Word limit per question: 400 words (200 words per part of question)

(a) What is Alana's expected wealth, expected utility, and utility of expected wealth? If she can insure "fully", and if this insurance is fair, how much would it cost her?

(b) What is the maximum amount Alana would be prepared to pay for full insurance? What is the certainty equivalent and the risk premium associated with the uncertain situation she is in if she does not have any insurance? What difference would it make if her utility of wealth function were instead u(w) = 5w?

If the coefficient of kinetic friction is 0.2, what friction of the total mechanical energy is lost due to frictional forces?

If studies suggest that the price elasticity of demand for cigarettes is 0.2 (in absolute terms), and the government wishes to decrease cigarette consumption by 25%, how much of a price increase by taxation would be required to bring this about?

Is this policy to reduce smoking likely to have:

(a) a larger effect in the longer term than in the shorter term?

(b) a larger effect on younger smokers than older smokers?

1) Given the following equations:

   QD = 5,000 + 0.5 I + 0.2 A - 100P, and QS = -5000 + 100P

where Q is the quantity per year, P is price, I is income per household, and A is advertising expenditure.

  a.   If A = $10,000 and I = $25,000, what is the demand curve?

b.   Given the demand curve in part a., what is equilibrium price and quantity?

c.   If consumer incomes increase to $30,000, what will be the impact on equilibrium price and quantity?

2) Industry supply and demand are given by QD = 1000 - 2P and QS = 3P.

a.   What is the equilibrium price and quantity?

b.   At a price of $100, will there be a shortage or a surplus, and how large will it be?

c.   At a price of $300, will there be a shortage or a surplus, and how large will it be?

Suppose that the antenna lengths of woodlice are approximately normally distributed with a mean of 0.2 inches and a standard deviation of 0.05 inches. What proportion of woodlice have antenna lengths that are less than 0.23 inches? Round your answer to at least four decimal places.

1) Given the following equations:

   QD = 5,000 + 0.5 I + 0.2 A - 100P, and QS = -5000 + 100P

where Q is the quantity per year, P is price, I is income per household, and A is advertising expenditure.

  a.   If A = $10,000 and I = $25,000, what is the demand curve?

b.   Given the demand curve in part a., what is equilibrium price and quantity?

c.   If consumer incomes increase to $30,000, what will be the impact on equilibrium price and quantity?

2) Industry supply and demand are given by QD = 1000 - 2P and QS = 3P.

a.   What is the equilibrium price and quantity?

b.   At a price of $100, will there be a shortage or a surplus, and how large will it be?

c.   At a price of $300, will there be a shortage or a surplus, and how large will it be?

One of the major problems with front office accounting at the Royal Crest Hotel is monitoring guest and non-guest accounts using their manual system. Management has always extended local businesses and government officials charge privileges, the idea being that, with the convenience of deferred payments, local patrons would be more likely to dine and/or host clients at the hotel. This program has proved to be highly successful. The volume of purchases charged to such non-guest accounts now approximates the level of sales incurred by registered guests. Unsure if this is a good or bad situation, Mr. Osei, the front office manager, requests the front office accounting staff to study the problem and to report its findings at next week's front office meeting. At the weekly front office meeting, the hotel's accountant, Ms. Pokua, reports that there are at least three problems related to the hotel's non- guest charge purchasing policies: its impact on the daily hotel audit, the billing procedures to collect payment, and the number of applications for additional non-guest accounts. When asked to be more specific, she begins with a review of the daily hotel audit. She states that since the front office receives charge vouchers from the hotel's revenue centers, it is the front desk agent's responsibility to separate guest from non-guest accounts. Since registered guest charges are posted by room number, one would think it easy to sort those charges from the others. Unfortunately, both the hotel's guest account numbers and the non-guest account numbers are three digits, thereby making the sorting more time-consuming. Mr. Osei asks if it is really necessary to separate the charges. Ms. Pokua explains that it is, since the hotel must maintain accurate guest folio Page 2 of 1 G. N. Baah balances. She further states that the non-guest vouchers are accumulated and posted on Saturday afternoons, when the hotel's business is less hectic. The billing procedures to collect non-guest account balances are tricky, Ms. Pokua said. Since the hotel bills non-guest accounts on the last day of each month, some charges occurring in a particular month may not be posted in time to appear on that month's bill. In addition, non-guest accounts usually are not paid in time. In fact, 47 percent of last month's non-guest account balances remain unpaid and tomorrow is the date of the next billing cycle. Mr. Osei explains that the local customers are important to the hotel and suggests that maybe Ms. Pokua is over-sensitive to the billing problems. Lastly, Ms. Pokua relates the fact that there are at least ten new applications for non-guest accounts. She has instructed her staff not to authorize any new non-guest accounts without her written approval. She further states that she is reluctant to authorize any additional non-guest accounts, and looks to Mr. Osei for advice. Convinced of the positive aspects of such business, Mr. Osei directs her to approve the requests and to assign account numbers effective the first day of next month. Ms. Pokua so instructs her staff. a. What ideas (any two) would you suggest to facilitate a more effective processing of guest and non- guest charge vouchers? b. How might the daily audit be aided by such changes? c. Is the accumulated-postings routine for non-guest accounts an effective plan? Explain your response. d. What could be done to improve the hotel's billing of non-guest accounts? e. What could be done to improve collection of outstanding balances? State any four (4). f. What are the two (2) advantages and two (2) disadvantages to having a high volume of non- guest accounts? NOTE; PLEASE I NEED DIFFERENT ANSWERS.

How would you interpret the below financials?