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Expected Value Analysis
A form of analysis that assigns likelihoods (probabilities) to various inputs, thus incorporating uncertainty directly into the output (answer).
Probabilities
A measure representing the likelihood or chance of certain events occurring, expressed as a number between 0 and 1.
Uncertainty
A lack of definite knowledge or predictability about outcomes, often factored into decision-making and risk assessments.
Present Value Index
An index computed by dividing the total present value of the net cash flow to be received from a proposed capital investment by the amount to be invested.
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