A company needs to make an important decision in the face of uncertainty. It has been estimated
Fantastic news! We've Found the answer you've been seeking!
Question:
A company needs to make an important decision in the face of uncertainty. It has been estimated that the firm will either gain $10 000 with probability 0.4, gain $1000 with probability of 0.3 or lose $5000 with probability 0.3. Having taken a Business Analytics course, employee X (correctly) calculates the EMV as $2800. Her colleague Y distrusts her analysis, since after all, the firm will either receive 10 000, 1000 or lose 5000, and 2800 is not one of these options. Who is correct and why?
Related Book For
Business Analytics Data Analysis and Decision Making
ISBN: 978-1305947542
6th edition
Authors: S. Christian Albright, Wayne L. Winston
Posted Date: