Which of the Following Statements Is Likely to Be Correct

question 31

Multiple Choice

Which of the following statements is likely to be correct for a decision tree which indicates a 30 percent chance of making a $250,000 profit and a 70 percent chance of sustaining a $140,000 loss?

• A)the decision should be "yes" whenever the amount of possible profit exceeds the amount of possible loss.
• B)the decision should be "no" whenever there is a possibility of loss.
• C)the expected value is positive before discounting.
• D)the expected value is negative before discounting.

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Definitions:

Agreed

The state or action of having the same opinion or decision about something with others.

Royals

Members of a royal family, typically referring to those with titles such as king, queen, prince, or princess.

Pennant

A flag that serves as a symbol of a sports team or a sign of victory in sporting competitions.

Red Giants

A phase in the life cycle of a star where it expands and cools after exhausting the hydrogen in its core, typically marked by a significant increase in size and a change in color to red.