What Credit Decision Is Appropriate for a Potential Customer That

Multiple Choice

What credit decision is appropriate for a potential customer that offers a 75% chance of paying on a $10,000 sale which has an 80% cost?

A) Grant credit since the expected profit is $3,200.
B) Grant credit since the expected profit is $800.
C) Refuse credit since the expected profit is negative.
D) Refuse credit since the expected loss is zero.