A Company Is Bidding on Two Projects, a and B

question 51

Multiple Choice

A company is bidding on two projects, A and B. The probability that the company wins project A is 0.40 and the probability that the company wins project B is 0.25. Winning project A and winning project B are independent events. What is the probability that the company wins project A or project B?

• A) 0.55
• B) 0.65
• C) 0.30
• D) 0.25

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Definitions:

Debt-equity Ratio

Ratio that measures a company's financial leverage by dividing its total liabilities by its shareholder's equity, indicating the balance between debt financing and equity financing.

Direct Bankruptcy Costs

The costs that are directly associated with bankruptcy, such as legal and administrative expenses.

Financial Trouble

Financial trouble indicates a situation where an individual, company, or other entity is struggling to manage or repay their debts or meet financial obligations.

High-quality Employees

Refers to employees who are highly skilled, efficient, and produce excellent work consistently.