Provide an Appropriate Response

question 72

Multiple Choice

Provide an appropriate response.
-Suppose you pay $2.00 to roll a fair die with the understanding that you will get back $4.00 for rolling a 2 or a 3, nothing otherwise. What is your expected value?

• A) -$0.67
• B) -$2.00
• C) $2.00
• D) $4.00

Understand the impact of interest rate changes on the present value of future cash flows.

Analyze investment decisions using NPV methodology.

Understand the role of vigilant investors in the economy.

Understand the concept of constant net returns in stock value determination.