ANSWER IN QALYS. DISCOUNT ALL THREE YEARS. ROUND TO TWO DECIMAL PLACES.
1. Suppose Sam has the opportunity for a treatment that will extend his life by one year with a probability of 0.78 by two years with a probability of 0.50, and three years with a probability of 0.18. Sam will die with certainty after three years. QALY weight q1 is 0.9 in year 1, q2 is 0.6 in year 2, and q3 is 0.2 in year 3. The discount rate is 5% per year. The total number of discounted QALYs from this treatment is:
2. Suppose Cathy has the opportunity for a treatment that will extend her life by one year with a probability of 0.69 by two years with a probability of 0.54, and three years with a probability of 0.30. Cathy will die with certainty after three years. QALY weight q1 is 0.8 in year 1, q2 is 0.7 in year 2, and q3 is 0.5 in year 3. The discount rate is 9% per year. The total number of discounted QALYs from this treatment is:
ANSWER IN QALYS. DISCOUNT ALL THREE YEARS. ROUND TO TWO DECIMAL PLACES. 1. Suppose Sam has...
Suppose, Sam has the opportunity for a treatment that will extend his life by one year with a probability of 0.9, by two years with a probability of 0.5, and three years with a probability of 0.3. Sam will die with certainty after three years. QALY weight q1 is 0.9 in Year 1, q2 is 0.6 in Year 2, and q3 is 0.2 in Year 3. The discount rate is 0.05 per year. a. What is the total number of...
10. Suppose that a patient has the opportunity for a treatment that will extend life: - By one year with a probability of 0.9 - By two years with a probability of 0.5 The patient will die with certainty after two years. Quality weight: q1 is 0.8 in year 1, and q 2 is 0.6 in year 2. The discount rate is 0.05 per year a. What is QALY for this patient? b. Suppose that the 2nd year of treatment...
b. Payback period (Round your answer to two decimal places.) The payback period is years. c. Discounted payback period (Round intarim calculations to the nearest whole dollar, Round the rate to two decimal places, XXX % .) The discounted payback period is years d. Intemal rate of return (Round the rate to two decimal places, XXX %) The internal rate of return (RR) is e. Accrual accounting rate of return based on net initial investment (Round interim calculations to the...
Consider a $5,000 payment that is to be received exactly three (3) years from now. If the discount rate is 5%, what is the “present value” of the future $5,000 payment? Group of answer choices a. $4,319.19 b. $4,750.00 c. $4,761.90 d. $5,788.13 A pharmaceutical firm has recently developed a new medication, and is now considering whether or not to market the new medication over the next two years. The firm has decided to use “cost-benefit analysis” to make its...
1. Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of $7,000 and has expected cash flows of $3,000 in year 1, $4,000 in year 2, and $4,000 in year 3. Project B has an initial outlay of $10,000 and has expected cash flows of $2,000 in year 1, $4,000 in year 2, and $5,000 in year 3. The required rate of return is 12% for projects...
1. a. Two investors, A and B, are evaluating the same investment opportunity, which has an expected value of £100. The utility functions of A and B are ln(x) and x2, respectively. Which investor has a certainty equivalent higher than 100? Which investor requires the higher risk premium? b. (i) Describe suitable measures of risk for ‘loss-aversion’ and ‘risk aversion’. (ii) Concisely define the term ‘risk neutral’ with respect to a utility function u (w), where w is the realisation...
Handstar Inc was created a little over 4 years ago by two college roommates to develop apps for smartphones. It has since grown to ten employees with annual sales approaching $1.5 million. Handstar's original product was an expense report app that allowed users to record expenses on their smartphone and then export their expenses into a spreadsheet that then created an expense report in one of five standard formats. Based on the success of its first product, Handstar subsequently developed...