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Mary Beth Clothes is considering opening an additional suburban outlet. An aftertax cash flow of $100 per day (expected value) is projected for each of
Mary Beth Clothes is considering opening an additional suburban outlet. An aftertax cash flow of $100 per day (expected value) is projected for each of the two locations being evaluated. Site A Probability Cash Flows 0.20 0.30 0.30 0.20 Expected value Site A Site B $50 100 110 135 $100 O Site A O Site B Site B Coefficient of variation Probability 0.10 0.20 0.40 0.20 0.10 Expected value a. Compute the coefficient of variation for each site. (Do not round intermediate calculations. Round the final answers to 4 decimal places.) Cash $ Flows 20 50 100 150 180 $100 b. Which of these sites would you select based on the distribution of these cash flows?
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