Decision Tree Probabilities Refer to

question 18

Multiple Choice

Decision tree probabilities refer to

• A) the probability of finding the optimal strategy
• B) the probability of the decision being made
• C) the probability of overlooked choices
• D) the probability of an uncertain event occurring

---

Definitions:

Annuity

A series of equal cash flows at fixed intervals.

Equal Cash Flows

Financial inflows or outflows that are identical in amount over specified periods.

Fixed Intervals

Predetermined periods or times at which certain events or actions are scheduled to occur.

Net Present Value

Net Present Value is the calculation that measures the difference between the present value of cash inflows and the present value of cash outflows over a period of time.