We assume that you are looking for a used car and you have three different ones to choose from

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We assume that you are looking for a used car and you have three different ones to choose from. They all have different prices and quality, which reflect the probability that the car will break down in the future. You would have to pay for repairs if the car breaks down, to be able to use it again. Price Risk of breaking down Repair cost Car 1 $ 5 000 17 % $ 4 000 Car 2 $ 7 750 10 % $ 5 000 Car 3 $ 8 000 7 % $ 8 000 a. Calculate the actual cost of each car including the possibility that the car breaks down and you need to pay for the repairs. Start with Car 1, followed by Car 2, and thereafter Car 3 in your answer. (3 points) b. If you are indifferent between the three cars and risk), which one should you buy? (3 points) Select one alternative Car 1 Car 2 Car 3 C. Assume now that you have different benefit from each of three cars. This is illustrated in the table below in monetary terms: Benefit Car 1 $ 6 000 Car 2 $ 8 500 Car 3 $ 10 250 Taking your actual benefit into account, which car should you buy? (3 points) Select one alternative Car 1 Car 2 Car 3