Business, 19.02.2021 01:00 ny01282005

QUESTION 1 I drive to UB and am currently looking for a parking spot so I can walk to Jacob's. If I turn into a parking lot to look for a spot to park in that specific lot, the process of looking for a spot takes 1 minute of time whether I find a spot or not (so if I have to check two lots to find a spot, it takes me 2 minutes to find a spot total). Parking lot A is closer to Jacobs. If I get a spot here, it takes me 4 minute to walk into my class at the business school, however there is only a 30% chance I'll find a spot if I look. Parking lot B is an 8-minute walk. If I pull in to look for a spot, there is a 100% chance I will find a spot. Assume that it does you no good to keep looping through a full parking lot (ie. if it is full, it stays full). Which strategy to find a parking spot is best for me (ie. which order should I check the parking lots for spots to park), if I am risk-neutral, and simply want to have the earliest expected arrival time to Jacob’s as possible? (Another way to say this is we want the smallest expected value of time spent getting to Jacob’s). Now, assume I am risk averse (let’s say that in this second case, my class starts in 10 minutes, and there is a large decrease in my utility if I am late for class). Is the best strategy the same as when I am risk-neutral, or has it changed?

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QUESTION 1 I drive to UB and am currently looking for a parking spot so I can walk to Jacob's. If I...

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