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Under normal conditions (73% probability), Financing Plan A will produce a $20,000 higher return than Plan B. Under tight money conditions (27% probability), Plan A

Under normal conditions (73% probability), Financing Plan A will produce a $20,000 higher return than Plan B. Under tight money conditions (27% probability), Plan A will produce $34,000 less than Plan B. What is the expected value of return?

  • $5,420

  • $4,620

  • $42,560

  • $37,940

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