Multiple Choice
Which of the following statements is likely to be correct for a decision tree that indicates a 30% chance of making a $250,000 profit and a 70% 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.
Correct Answer:

Verified
Correct Answer:
Verified
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