Wilderness Vacation Resorts,Inc

Multiple Choice

Wilderness Vacation Resorts,Inc.has a project that costs $400,000.It has a 30% chance of a $1,000,000 payoff and a 70% chance of a $200,000 payoff.What is the expected payoff and the expected profit or loss from the new project?

A) The expected payoff is $600,000,and the expected gain is $200,000.
B) The expected payoff is $440,000,and the expected loss is $40,000.
C) The expected payoff is $440,000,and the expected gain is $40,000.
D) The expected payoff is $600,000,and the expected loss is $200,000.