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Draw Corp decision tree and calculate the expected value of the project? Question: ? Gensco Corp. is preparing to develop a new product that requires
Draw Corp decision tree and calculate the expected value of the project?
Question: ? Gensco Corp. is preparing to develop a new product that requires an investment of $500,000. Gensco believes that if it develops the product there is a 75% chance that it will be able to sell the product to a manufacturer at a profit of $1,000,000. Legal issues are such that if it is unable to sell the product at this price, it will not sell the product at all. What is the expected value of the project?
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Intermediate Accounting
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones
10th Edition
324300980, 978-0324300987
