Based on the Following Payoff Table, Answer the Following The Expected Value of Perfect Information Is:
A) 4

question 11

Multiple Choice

Based on the following payoff table, answer the following:
$$\begin{array} { | l | r | r | } \hline { \text { Alternative } } & { \text { Yes } } & { \text { No } } \\\hline \text { Brmall } & 10 & 30 \\\hline \text { Medium } & 20 & 40 \\\hline \text { Mediurn Large } & 30 & 45 \\\hline \text { Large } & 40 & 35 \\\hline \text { Extra Large } & 60 & 20 \\\hline \text { Prior Probability } & 0.3 & 0.7 \\\hline\end{array}$$
The expected value of perfect information is:

• A) 4.5.
• B) 9.
• C) 40.5.
• D) 49.5.
• E) 60.

---

Definitions:

Selling Expenses

Costs associated with the marketing and sale of products or services, excluding the cost of goods sold.

Depreciation

An accounting method that allocates the cost of a tangible asset over its useful life.

Cost Of Goods Sold

represents the direct costs attributable to the production of the goods sold by a company, including material, labor, and manufacturing overhead costs.

Master Budget

The master budget is a comprehensive financial planning document that consolidates all of a company's individual budgets relating to sales, costs, operations, and capital.