Question: A new product's chief uncertainty is its annual net revenue. So far, $35,000 has been spent on development, but an additional $30,000 is required finish

A new product's chief uncertainty is its annual net revenue. So far, $35,000 has been spent on development, but an additional $30,000 is required finish development. The firm's interest rate is 10%.

(a) What is the expected PW for deciding whether to proceed?

(b) Find the P(loss) and the standard deviation for proceeding.

State Bad OK Great 0.2 0.5 Probability Net revenue Life, in years 0.3 $15,000 $20,000 -$15,000 5 5 10

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