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Suppose the management of an FMCG company is contemplating investing in a certain project. Before doing so, it wants to estimate whether it can expect
Suppose the management of an FMCG company is contemplating investing in a certain project. Before doing so, it wants to estimate whether it can expect to make a profit, which will depend heavily on the economic cycle. Based on the opinions of some experts, the following table is created.
Economic Cycle | X (Net Revenue from the Project in Crore ) | P(X) |
Recession | -305 | 0.1 |
Stagnancy | +15 | 0.7 |
Boom | +95 | 0.2 |
Mean, Variance and Standard Deviation
What is the expected value of the project in crores?
60
-1
415
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