Mountain Orthopedics is considering purchasing a Back Blaster 2000. Back Blaster 2000 (BB2) uses sound waves to alleviate back pain.

The practice manager has run the numbers on the BB2, but is still quite unsure of the portential demand for it.

Here are the best data the practice manager has arrived at:

Scenario Probability NPV

Low Demand 20% -250,750

Medium Demand 40% 150,000

High Demand 40% 400,000

What is the Expected Value of the Back Blaster 2000?

A.

$169,850

B.

$270,150

C.

$299,250

D.

$150,000

E.

none of these