Question
You are considering an investment opportunity that requires $120,000. You currently have the $120,000 in a certificate of deposit that is safely earning 10% per
You are considering an investment opportunity that requires $120,000. You currently have the $120,000 in a certificate of deposit that is safely earning 10% per annum. If you move forward with the investment and it is successful, it will generate $50,000 profit after one year. If the investment is not successful, you will lose $90,000 of your investment. Assuming you want to maximize the expected monetary return on your funds, what would the probability of success for the investment would have to be in order for your to consider moving forward with the investment?
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