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As mentioned, the Security Director had some difficulty in convincing the Board and executive officers of the $985,000 additional annual revenue. If the following probability
- As mentioned, the Security Director had some difficulty in convincing the Board and executive officers of the $985,000 additional annual revenue. If the following probability distribution applied to each year's additional revenue and the Board and executive officers wanted to make its decisions on the basis of the expected value of this additional revenue, should they invest in the new system?
Probability % | Additional Revenue $ |
.10 .35 .25 .15 .10 .05 | 750,000 985,000 1,025,000 1,200,000 1,350,000 1,700,000 |
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