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Suppose you are going to invest in a project that has a 60-40 chance of success and failure.In case of success, the project pays you
Suppose you are going to invest in a project that has a 60-40 chance of success and failure.In case of success, the project pays you off $ 125,000 and in case of failure, it pays off nothing.
A) Calculate the expected return of the project.
B) If you are going to take $ 50,000 as the loan with the interest rate of 10% from a bank to finance your project, calculate the expected return of the project in this case.
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