Question: An organization has two options for dealing with a possible loss. Option A reduces the expected value of the loss from $350,000 to $90,000 at

 An organization has two options for dealing with a possible loss.

An organization has two options for dealing with a possible loss. Option A reduces the expected value of the loss from $350,000 to $90,000 at a cost of $120,000 and Option B reduces the expected value of the loss from $350,000 to $40,000 at a cost of $150,000. Which option is preferable? Option A is preferable since it costs less than Option B. Option B is preferable since it results in a lower expected value of the loss. Option B is preferable because it has a higher "net benefit" than Option A has. The options are equally preferable since they both reduce the expected value of the loss

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