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Refer to Scenario 5.5. Jalopy Automotive's executives,:

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Refer to Scenario 5.5. Jalopy Automotive's executives,:

Refer to Scenario 5.5. Jalopy Automotive's executives,
A) if risk-neutral, would fix the flaw because it enables them to have a sure outcome.
B) if risk-neutral, would fix the flaw because the cost of fixing the flaw is less than the expected cost of not fixing it.
C) if risk-loving, would fix the flaw because it enables them to have a sure outcome.
D) if risk-averse, would not fix the flaw because the cost of fixing the flaw is more than the expected cost of not fixing it.
E) would fix the flaw regardless of their risk preference, because of the large probability of high-cost outcomes.

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Microeconomics

Edition: 8^th

Author: Pindyck

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Brilliant ツ

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