A)What is the expected revenue? b)What is the standard deviation? c)What is the coefficient of variation? d)Do the same for the 2 nd set of probabilities.

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Presentation transcript:

a)What is the expected revenue? b)What is the standard deviation? c)What is the coefficient of variation? d)Do the same for the 2 nd set of probabilities. e)Which is a riskier situation? SalesProbabilitiesProbabilities

BO0K ABOOK B ProbProfitProbProfit A) What is the expected profit, standard deviation, and coefficient of variation for each. B) If asked, which book would you recommend publishing? Why?

Suppose you can make an investment with the following possible rates of return: ProbRate of return % 0.610% % You can invest in a US T-Bill that earns a certain 7%. Evaluate the two alternatives.

Project A has an expected net present value of $500 and a standard deviation of $125. Project B has an expected net present value of $300 and a standard deviation of $100. Which of the two projects would you select? Why?