Aresearcher studying the effect of price promotions on consumers' expectations makes up two different histories of the store price of a hypothetical brand of laundry detergent for the past year. students in a marketing course are randomly assigned to view one or the other price history on a computer. some students see a steady price, while others see regular promotions that temporarily cut the price. then the students are asked what price they would expect to pay for the detergent.

An insurance company estimates the probability of an earthquake in the next year to be 0.0015. the average damage done to a house by an earthquake it estimates to be $90,000. if the company offers earthquake insurance for $150, what is company`s expected value of the policy? hint: think, is it profitable for the insurance company or not? will they gain (positive expected value) or lose (negative expected value)? if the expected value is negative, remember to show "-" sign. no "+" sign needed for the positive expected value