Consider the Disaster Risk Decision Tree Model

question 122

Multiple Choice

Consider the disaster risk decision tree model. Using the notation from the model, what is the expected monetary value (cost) of choosing two suppliers?

• A) 2C
• B) [1 - P(2)] × 2C + P(2) × (L + 2C)
• C) 2C + SL
• D) P(2) × 2C + [1 - P(2)] × (L + 2C)
• E) 2C + (S + U²)L

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Definitions:

Revenues

Revenues are the total amount of money received by a company for goods sold or services provided during a specific period.

Expenses

Costs incurred in the process of earning revenue, often categorized into operating and non-operating expenses.

Balance Sheet

An accounting statement that itemizes the total assets, liabilities, and equity of shareholders at a defined date.

Accounts Payable

Liabilities owed by a business to its suppliers or vendors for goods and services purchased on credit.