Question: b. Net present value = $46,000 + $12,000 = $58,000 Standard deviation = [328,040,000 + (9,000)2 + (2)(.4)(9,000)(8,000)+ (2)(.2)(9,000)(7,000) + (2)(.3)(9,000)(4,000])'/ ' = [513,440,000]112 =
b. Net present value = $46,000 + $12,000 = $58,000 Standard deviation = [328,040,000 + (9,000)2
+ (2)(.4)(9,000)(8,000)+ (2)(.2)(9,000)(7,000)
+ (2)(.3)(9,000)(4,000])'/ ' = [513,440,000]112
= $22,659
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