Tom wants to avoid any accidents on the work floor of his factory. If an accident does occur, it would cost him $500,000 in damages. Installing safety equipment would decrease the probability of an accident occurring from 20% to 10%. However, the equipment costs $20,000 to install.

What is his expected loss after installing the safety equipment?

	a.	$50,000
	b.	$20,000
	c.	$100,000
	d.	$125,000

Answer rating: 100% (QA)

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