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1)A)Using the binomial distribution, what is the probability of receiving 1 or 3 heads out of five tosses of a coin? B) The Powerball Lottery requires you to select 5 numbers between 1 and 68 and 1 number between 1 and 26

Economics Oct 21, 2020

1)A)Using the binomial distribution, what is the probability of receiving 1 or 3 heads out of five tosses of a coin?

B) The Powerball Lottery requires you to select 5 numbers between 1 and 68 and 1 number between 1 and 26. What is the probability of selecting ALL numbers correct? (Please show your work).

C) Assume the probability of success is 20%. What is the chance that it takes 12 failures of a game before you win on the 13th?

2)In terms of FDI motivation, what is a Chinese website development company likely seeking when it buys a NZ gaming software company?
3)Assume you put $10,000 into a bank account. How much will your investment be worth after 10 years at an annual interest rate of 5% compounded monthly? Ans. ($16,470.00) b. Find the nominal rate compounded monthly which is equivalent to 16% compounded quarterly. What is the corresponding effective rate? Ans.(r=15.79%; Eri = 16.98% )

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answer 2)FDI stands for foreign direct investment where an individual or a company from one nation invests into the business in some other nation by way of investing in some other's running business or starting up a new venture.

FDI is of generally three types namely,

  1. horizontal fdi
  2. vertical fdi
  3. conglomerate fdi

Here, the chinese website development company had done the horizontal fdi, that means it has done investment with company dealing with similar business. Gaming company comes under the umbrella of the website development company. By initiating an FDI the chinese company seeks to sieze the benefits such as:

  • it will transfer technological knowledge to the domestic company
  • improves competitiveness
  • boosts productivity growth
  • mobility of work force between the countrie
  • aims at reducing the transportation cost and production cost
  • increases market share
  • reduces competition
  • creates economies of scale
  • builds a bigger customer base
  • inreased revenue 
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