A company has to decide which of three mutually exclusive projects to invest in next year. The directors believe that the success of the projects will vary depending on economic conditions. There is a 30 percent chance that conditions will be good, a 20 percent chance that conditions will be fair and a 50 percent chance that conditions will be poor.The company uses expected value to make this type of decision.The net present value for each of the possible outcomes is as follows:

A firm of economic analysts believes it can provide perfect information on economic conditions.

Required:Calculate the maximum amount that should be paid for the information from the firm of economic analysts.

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Project A $000 Economic Project B $000 Project C $00 conditions Good 800 700 700 Fair 400 500 600 400 Poor 300 500