Firm X Is Considering a Project and Its Analysts Have

question 27

Multiple Choice

Firm X is considering a project and its analysts have projected the following outcomes and their probabilities.
$$\begin{array}{l}\begin{array} { r c ll } &\text { Probability of }\\\text { Outcome } & \text { Outcome } & &\text { Assumption }\\\$4,600 & 30 \% & \text { pessirmstic } \\\$7,800 & 45 \% & \text { moderately swccessful } \\\$13,500 & 25 \% & \text { optimistic }\end{array}\end{array}$$
What is the expected value of the outcomes?

• A) $3,375
• B) $8,633
• C) $8,265
• D) Cannot be determined. Depends upon which prediction is correct.

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Definitions:

On-Demand Access

Provisioning immediate access to resources or services whenever and wherever they are required by the user, similar to "on-demand" but emphasizing the accessibility aspect.

Pay-As-You-Go

A payment model where services or goods are paid for as they are used, rather than through a subscription or upfront fee.

-As-A-Service

-As-A-Service denotes business models where products or services are provided over the internet on a subscription basis, such as Software-as-a-Service (SaaS).

Delivery Model

Refers to the method by which goods or services are delivered to end customers, including direct, indirect, or digital channels.