Question: A project has three possible outcomes Probability P 0 61PP Outcome Profit of 50 000 Profit of EO Loss of 10,000 Expected value 30 000

A project has three possible outcomes Probability P 0 61PP Outcome Profit of 50 000 Profit of EO Loss of 10,000 Expected value 30 000 0 (2.000) 28.000 EV B 0 2 pb 0.2.pl EV of project a) What is the sensitivity of a decision to undertake this project, in respect of i) the 50.000 profit estimate ii) the 10.000 loss estimate mi) the estimated probability of making a profit, assuming that the probability of breaking even will always be 02 b) Explain what action might be taken as a result of this analysis

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