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- What is time inconsistency problem? Give two examples of time inconsistency problemThe Montag Family purchased a house in 2020 and expects its value (in thousands of dollars) t years in the future will be well-modeled by the function V(t)=310(1.08). By what percentage does the model predict the house will increase in value each year?The following is the data of recent refrigerator sales at a local Home Depot store. Month 1 2 3 4 5Actual Sales 95 100 80 90 ???Inputs will be exact numbers. What is the forecasted sales in month 5 using naive approach.Please use a 2-month simple moving average method to forecast sales in month 5.Please use a weighted moving average method, with weights of 0.6 one period ago, 0.3 two periods ago, and 0.1 three periods ago, to forecast sales in month 5.
- Hello, can you explain how I’m supposed to figure this out? How am I supposed to know which Qs and Qd correlate?Suppose your utility function for money is a square-root function of its value in US dollars. So, for instance, $400 is worth 20 utils for you, $961 is worth 31 utils for you, and $62.5K is worth 250 utils for you. Now, let’s say your annual salary is $90K, although there is a small risk (p = 0.05) that something catastrophic will happen and reduce your income for the year to $14.4K. An insurance company comes along and offers to insure you against the loss of your salary. The cost of the insurance is $4,736. If you buy the policy and catastrophe strikes, the insurance company will pay out the $75,600 that you would otherwise have lost. From the standpoint of maximizing expected utility, would buying this insurance be a good deal for you? What would be the insurance company’s expected monetary value of selling you the policy?Y = 1million + 56.43*X + error By how much does the expected value of Y change if X increases by 2 units? (Round your answer to two decimal places: ex: 123.45) Y = 50 + 3X + error By how much does the expected value of Y change if X decreases by 10 units?
- Suppose that you work for a U.S. senator who is contemplating writing a bill that would put a national sales tax in place. Because the tax would be levied on the sales revenue of retail stores, the senator has asked you to prepare a forecast of retail store sales for year 8, based on data from year 1 through year 7. The data are: (c1p2) Year Retail Store Sales 1 $1,225 2 1,285 3 1,359 4 1,392 5 1,443 6 1,474 7 1,467 54 Chapter One a. Use the first naive forecasting model presented in this chapter to prepare a forecast of retail store sales for each year from 2 through 8. b. Prepare a time-series graph of the actual and forecast values of retail store sales for the entire period. (You will not have a forecast for year 1 or an actual value for year 8.) c. Calculate the root-mean-squared error for your forecast series using the values for year 2 through year 7. 3. Use the second naive forecasting model presented in this chapter to answer parts (a) through (c) of Exercise 2. Use P 0.2 in…Please explain, inclusive of formulasShow me full answers and steps to part d) and e) Don’t use R or excel formula. Use expected formula and mean formula to calculate
- (Ch7) Historically, the default rate on a commercial loan is 20 percent. If a bank makes 100 commercial loans, what is the approximate probability that more than 25 loans will result in default? (hint: use the normal approximation to the binomial. And, by continuity correction, you should use 25.5 as the new cutoff.) Question 2Select one: a. 0.0668 b. 0.0838 c. 0.2000 d. 0.0336Please give me correct and incorrect answer explationDivergence happens when the price of an asset and the indicator moves to same directions
