Which of the Following Statements Is Likely to Be Correct

Multiple Choice

Which of the following statements is likely to be correct for a decision tree which indicates a 30 percent chance of making a $250,000 profit and a 70 percent chance of sustaining a $140,000 loss?

A) the decision should be "yes" whenever the amount of possible profit exceeds the amount of possible loss.
B) the decision should be "no" whenever there is a possibility of loss.
C) the expected value is positive before discounting.
D) the expected value is negative before discounting.