The credit manager of the Ewok Aircraft Company must decide whether to extend credit to the

Jetti Travel Company to purchase one of its executive planes. If credit is extended, the credit

manager expects that the sale will contribute $150,000 to profits. However, if the Jetti Travel

Company defaults on its obligation, it is estimated by the credit manager that the company will

realize a loss of $280,000. The credit manager believes that there is a 75% chance that the Jetti

Travel Company will be capable of satisfying its obligation.: kiuy85

Required:

If the credit manager bases his decision on the expected value of the outcome, should he extend

the credit?