Decision Tree Analysis

question 51

Multiple Choice

Decision tree analysis:

• A)provides a relatively quick and easy way to get a rough idea of the probability distribution of NPV outcomes in a capital budgeting project.
• B)may prompt management to reject a project with a positive NPV (point estimate).
• C)does not apply to IRR analysis.
• D)a and b are both correct.

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Definitions:

Attribution Retraining

A psychological intervention aiming to change the way individuals explain events, focusing on enhancing positive attributions about themselves.

Pessimistic Causal Attributions

The tendency to explain negative events as being caused by stable, internal, and global factors.

Pathway Thinking

A cognitive process focusing on identifying and planning realistic steps towards goal achievement.

Agency Thinking

The capacity of individuals to act independently and make their own free choices, influenced by personal beliefs and goals.