Question: Afirm must choose between remaining where it is, with current capacity, and building a new facility with 50% more capacity. The estimated probability of future

Afirm must choose between remaining where it is,
Afirm must choose between remaining where it is, with current capacity, and building a new facility with 50% more capacity. The estimated probability of future demand is 75% for high and 25% for low. The current facility would provide $100,000 profit if there is high demand or $50,000 profit if there is low demand. The replacement facility would provide $160,000 profit if there is high demand but would only break even (zero profit) if there is low demand. What is the expected value for building a new facility? 120,000 80,000 200,000 160,000

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