A new products chief uncertainty is its annualnet revenue.
Chapter , Problem 10-53(choose chapter or problem)
A new products chief uncertainty is its annualnet revenue. So far, $35,000 has been spent ondevelopment, but an additional $30,000 is requiredto finish development. The firms interest rate is10%.(a)What is the expected PW for deciding whetherto proceed?(b)Find theP(loss) and the standard deviation forproceeding.StateBad OK GreatProbability0.3 0.5 0.2Net revenue$15,000 $15,000 $20,000Life, in years5 5 10
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