(3) Sometimes economists speak of the certainty equivalent of a risky stream of income. This problem asks you to compute the certainty equivalent of a risky bet that promises a 50-50 chance of winning or losing $6,000 for someone with a starting income of $75,000. We know that, if a person is risk-averse, a certain income of somewhat less than $75,000 will provide the same expected utility as taking this bet. Calculate the certain income (that is, the certainty equivalent income) that provides the same utility as does this bet for

In early january, burger mania acquired 100% of the common stock of the crispy taco restaurant chain. the purchase price allocation included the following items: $4 million, patent; $3 million, trademark considered to have an indefinite useful life; and $5 million, goodwill. burger mania's policy is to amortize intangible assets with finite useful lives using the straight-line method, no residual value, and a five-year service life. what is the total amount of amortization expense that would appear in burger mania's income statement for the first year ended december 31 related to these items?

Solomon chemical company makes three products, b7, k6, and x9, which are joint products from the same materials. in a standard batch of 320,000 pounds of raw materials, the company generates 70,000 pounds of b7, 150,000 pounds of k6, and 100,000 pounds of x9. a standard batch costs $3,840,000 to produce. the sales prices per pound are $10, $14, and $20 for b7, k6, and x9, respectively. (a) allocate the joint product cost among the three final products using weight as the allocation base. (b) allocate the joint product cost among the three final products using market value as the allocation base. (c) allocate the joint product cost among the three final products using weight as the allocation base.

Security prices are set by active market participants. which of the following is not a consequnce of this fact? a. the market price will be set by the buyer who can take best advantage of the asset. b. the price is set by the buyer willing to pay the highest price. c. superior information about an asset can increase its value by reducing its risk. d. market participants have a strong incentive to reveal private information about a security.