IBM IncHas a Project That Costs $150,000

question 56

Multiple Choice

IBM Inc.has a project that costs $150,000.It has a 50% chance of paying off $300,000 and a 50% chance of paying off $50,000.What is the expected payoff and the expected profit or loss from the new project?

• A)The expected payoff is $175,000 and the expected profit is $25,000.
• B)The expected payoff is $25,000 and the expected profit is $25,000.
• C)The expected payoff is $175,000 and the expected loss is $175,000.
• D)The expected payoff is $100,000 and the expected loss is $10,000.

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Definitions:

Classical Conditioning

An educational procedure in which pairing two stimuli multiple times causes a reaction initially provoked by the second stimulus to be provoked by only the first stimulus.

Operant Conditioning

A learning process through which the strength of a behavior is modified by reinforcement or punishment.

Attachment

A deep and enduring emotional bond that connects one person to another across time and space.

Cognitive Explanations

Theories or interpretations that account for a phenomenon based on mental processes such as perception, memory, and reasoning.