1. In 2003, a company employee received an option to purchase the company's stock at $45 per share. If the stock is trading at $40 a share in 2005, the employee will most likely
A. try changing the price in the original option agreement to improve the stock's performance.
B. hold on to the option, hoping the stock price will increase in the future.
C. exercise the option, receiving a gain of $40.
D. exercise the option, receiving a gain of $5.
2. Suppose a project team has arrived at the following time estimates for an activity: a = 4 days, m = 6 days, and b = 8 days. What is the variance involved in this activity?
0.111
0.250
0.444
0.69