You have two job offers. Alpha Firm offers a salary of $40,000 per year with no bonuses, while Beta Firmoffers a base salary of $35,000 per year with a 25% chance that you will receive an annual bonus of $10,000. The expected salary of working for Alpha Firm is ______ while the expected salary of working for Beta Firm is If you were risk neutral, the expected value of the yearr bonus offered by Beta Firm would need to be at least_ to be indifferent to the choice between the two options.

From the question above, we are given the following parameters; Alpha Firm offers a salary = $40,000 per year + no bonuses, "Beta Firm offers a base salary of $35,000 per year with a 25% chance that you will receive an annual bonus of $10,000".

So, to answer the question,the expected salary of working for Alpha Firm will surely be = $40,000 per year.

At Beta Firm the expected salary is = $35,000 + 0.25($10,000) = $37,500.

Therefore, if I was risk neutral, the expected value of the year bonus offered by Beta Firm would need to be at least $40,000 for me not to be indifferent to the choice between the two options.