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Ben needs cash fast and has asked Lucy for a loan.  Ben will willing to put up his PlayStation as collateral.  Lucy has determined after a quick Internet search that Ben's PlayStation is worth $300.  Based on an Experian credit report, Lucy has determined that there is a 50 percent chance that Ben will repay the loan at 10 percent interest.  How much should Lucy lend Ben?

a.

$1,500

b.

$750

c.

$300

d.

$500

e.

$1,000

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91580177

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